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Tether starting to lose its peg too, after Terra did
101–110 of 976 posts
Re: Tether starting to lose its peg too, after Terra did
#102Anything on any market can shift its price to the red or green. Tether and USDC are just tokens, so if there is enough sell pressure and not enough liquidity, the price on an exchange can jump to something else than $1. They are not fixed at a static $1. It's actually almost never exactly at $1 and the reason why it's immediately pegging back to $1 is because there is an arbitrage opportunity, assuming there is enoug…
> Seeing USDT at 0.97 temporarily doesn't mean much more than there is an insane amount of money exiting right now Eh you might be right, but there are orders executing at 0.95 now. Will you buy in for a “free” 6% ROI? I was planning on buying a couple of GPUs, but now I think I should wait a bit just in case ETH crashes lol Edit: Yeah you should have put your money where your mouth is. It’s back up to 0.988.
> just in case ETH crashes lol
Down about 20% in the last 24 hours so ... is that a crash?
Re: Tether starting to lose its peg too, after Terra did
#103If Tether is backed, then Bitfinex could buy currently-discounted tethers off the market and redeem them for face value, pocketing the difference. The fact this is not happening means they really don't have the money, do they?
Acting shifty and buying into a de-peg could have been the business plan all along. They could be waiting for it to fall more so they can pocket more money.
Re: Tether starting to lose its peg too, after Terra did
#104Anyone who thought tether coins could work out without the banks backing the fiat actually doing the tethering was misled at best.
Re: Tether starting to lose its peg too, after Terra did
#105The fact that they've been minting billions of tether without collateral should make it abundantly obvious that this isn't a stablecoin and never had been. Anyone can pretend to have a peg in the good times, that doesn't mean there's really a peg or that the peg will remain in bad times. And if you can't count on the peg in bad times, it's not a stablecoin. If you've been honestly working on the assumption that it is…
> If you've been honestly working on the assumption that it is, then you deserve to lose your (real) money to some crypto VCs on an island somewhere This is victim blaming. Nobody deserves to be exploited, robbed or otherwise for any reason.
"Deserves" is a word with variable meanings. You learn early on not to touch hot stoves. Do you morally deserve to get burned if you touch the stove anyway? Arguably no, but in the other meaning of "you should've known better", you kinda do deserve it.
Re: Tether starting to lose its peg too, after Terra did
#106Earlier quoted context omitted.
So wait, assuming I had a hundred k, and they were willing and able to pay out, I could buy 97k of tether and redeem it for 100k? Just an instant 3% return? This seems like there's no way they are opening themselves up to arbitrage like this.
It's $95k of tether now ;) And why wouldn't they allow this arb? By committing to that arbitrage you're pricing very low the risk of not actually being able to get your money once it has collapsed.
Isn't the point of pegging that you allow any arbitrage to keep the value from falling from about the nominal value?
Re: Tether starting to lose its peg too, after Terra did
#107Earlier quoted context omitted.
You need to show up with $100k to do the redemption. Granted if you did the round trip with only $10k you’re looking at peanuts in arbitrage but it _is_ a way for them to prevent real arbitrage that feeds into itself. I bet the fact that people wanting to short don’t believe they have the funds doesn’t help. But hey if you are a millionaire short tether might be worth setting up the recurring trade out!
USDT is now <$0.95, so the arbitrage opportunity is getting more exciting by the minute. It will be very interesting to see how long they can hold out against that.
Where are you seeing this? It's above $0.97
07:31:58 UTC Thursday, May 12, 2022
Re: Tether starting to lose its peg too, after Terra did
#108Load ze tether fud. I'm no fan of USDT, and don't hold it but the same thing happened in the May 2021 crash. I think it's just the high volume of people selling right now cause it to depeg. I think if it goes too far below you will see the major exchanges go into "maintenance mode" since they're all deeply invested into keeping it alive.
Right. It’s fairly trivial for the exchanges to disallow a sell order for a stable below a certain price. That’s an obvious thing they would do if things start to really spiral here.
Re: Tether starting to lose its peg too, after Terra did
#109The fact that they've been minting billions of tether without collateral should make it abundantly obvious that this isn't a stablecoin and never had been. Anyone can pretend to have a peg in the good times, that doesn't mean there's really a peg or that the peg will remain in bad times. And if you can't count on the peg in bad times, it's not a stablecoin. If you've been honestly working on the assumption that it is…
> If you've been honestly working on the assumption that it is, then you deserve to lose your (real) money to some crypto VCs on an island somewhere This is victim blaming. Nobody deserves to be exploited, robbed or otherwise for any reason.
it's much easier to con a greedy person. And you had to be very greedy indeed to convince yourself that 20% interest is a safe investment
Re: Tether starting to lose its peg too, after Terra did
#110Look at the front page of https://coinmarketcap.com/ There are 10114 different coins listed. Even if cryptos will deliver on the promises of the fully decentralized future, are we going to need that many different instruments? Today practically all merchants takes Visa and Mastercard. Some even take Amex, and a minuscule amount take BTC. Does anyone take a coin from page 73 of coinmarketcap.com?
To be fair a lot of those are specialty tokens for specific services/uses. Overall, the crypto situation can be thought of as more similar to, say, "gift cards" issued by companies. You could say the same thing about a $5 Starbucks gift card --- you'd be hard pressed to spend it directly against any other merchant, but you could feasibly try to sell it for < $5 real dollars and if Starbucks went under, it would be wo…
> To be fair a lot of those are specialty tokens for specific services/uses.
Is that true, or were they created as speculative instruments and are doomed to failure in the long run?