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$3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

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Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#111

Post by dfdaffg423rag »

jpmattia wrote: post #81
onlyrealcuzzo wrote: post #40

Earlier quoted context omitted.

Only 3.87% of Tether was backed by dollars: https://siliconangle.com/2021/05/13/tether-releases-reserve-... So it could drop pretty far.

> Only 3.87% of Tether was backed by dollars For comparison: Citibank had only 11.73% Tier 1 capital in their 2021 report: https://www.citigroup.com/citi/investor/quarterly/2021/ar20_... Couldn't find a breakout of their Tier 1, but it includes high-quality credit items as well, so actual dollars is well below 11.73%. So in other words: SiliconAngle.com is writing clickbait and doesn't understand modern banking.

I don't think anyone's going around using shares of Citibank stock as currency, are they? Because that's one of the many criteria that need to be true for that comparison to make any sense.

Blows my mind because stablecoins could be so easy-- hold some cash and hold some US treasuries. Pocket the interest. Become rich.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#112

Post by jpmattia »

bpt3 wrote: post #99
jpmattia wrote: post #81

Earlier quoted context omitted.

> Only 3.87% of Tether was backed by dollars For comparison: Citibank had only 11.73% Tier 1 capital in their 2021 report: https://www.citigroup.com/citi/investor/quarterly/2021/ar20_... Couldn't find a breakout of their Tier 1, but it includes high-quality credit items as well, so actual dollars is well below 11.73%. So in other words: SiliconAngle.com is writing clickbait and doesn't understand modern banking.

Did Citibank claim that its value was one-to-one backed with U.S. dollar reserves until they were caught not doing so? If not, they're probably not a relevant comparison to Tether.

> Did Citibank claim that its value was one-to-one backed with U.S. dollar reserves until they were caught not doing so? If not, they're probably not a relevant comparison to Tether.

I'm not getting what you're saying here: They should make good on their initial message from several years ago? They should now keep all assets in dollars and not earn interest?

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#113

Post by NovemberWhiskey »

thedudeabides5 wrote: post #80
snovv_crash wrote: post #76

Earlier quoted context omitted.

Tell me, what assets exactly are backing BTC which stop it from crashing just like Luna?

BTC is not pegged, that's the diff. When you don't claim a value, you don't need a 'backstop.'

There were two pieces of this particular crypto asset framework. The first part was Luna, which was a generic coin with no pegging mechanism or backing assets. The second part was Terra, which was a USD-pegged stable coin.

The novelty was a guaranteed mint/burn mechanism across the two which was intended to maintain the peg on Terra.

As the prior poster correctly asserts, Luna was never pegged.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#114

Post by tempnow987 »

dlubarov wrote: post #89
vkou wrote: post #62

Earlier quoted context omitted.

The guy was running a blatant Ponzi scheme (20% risk free yoy return for anyone investing in a 'stable' coin is a Ponzi), and it's the fourth time he's tried this (it's the first time it grew to multiple billions). He's not stupid, he's just a predator, and just like any other predator, belongs in prison.

The 20% interest was just a short-term user acquisition scheme, funded by some of the initial LUNA tokens. I don't think anyone claimed that it was sustainable. A Ponzi would be if Anchor used users' deposits to pay out the 20% rewards, which isn't what happened here.

A ponzi is if there is not actual asset backing the ponzi "values". Ie, the "stablecoin" will not actually hold value.

Wasn't Cashberry or something like this? Russian based? Ultimately no assets behind it, so when the music stopped they couldn't redeem the values.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#115

Post by jpmattia »

dfdaffg423rag wrote: post #111
jpmattia wrote: post #81

Earlier quoted context omitted.

> Only 3.87% of Tether was backed by dollars For comparison: Citibank had only 11.73% Tier 1 capital in their 2021 report: https://www.citigroup.com/citi/investor/quarterly/2021/ar20_... Couldn't find a breakout of their Tier 1, but it includes high-quality credit items as well, so actual dollars is well below 11.73%. So in other words: SiliconAngle.com is writing clickbait and doesn't understand modern banking.

I don't think anyone's going around using shares of Citibank stock as currency, are they? Because that's one of the many criteria that need to be true for that comparison to make any sense. Blows my mind because stablecoins could be so easy-- hold some cash and hold some US treasuries. Pocket the interest. Become rich.

> hold some cash and hold some US treasuries. Pocket the interest. Become rich.

Not getting what you're saying here: Only banks should have that privilege?

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#116

Post by NovemberWhiskey »

eric_cc wrote: post #92
loceng wrote: post #78

Earlier quoted context omitted.

What functionality was different between Bitcoin and Luna? Is Luna not run off of Bitcoin? So if Luna could function as a Ponzi scheme, why doesn't Bitcoin inherently have that same capability or function embedded into it? Or is there something preventing that from happening with Bitcoin? Confused.

Terra (token LUNA) is its own chain. Trillions of brand new LUNA tokens were minted within the span of a day or so rendering the token worthless. This is due to the way LUNA was tied to the algorithmic stablecoin UST. It was a true ponzi. BTC's max supply is capped and the release schedule of new coins is fixed and predictable. There is no possible way that trillions of new bitcoins could suddenly be created.

>There is no possible way that trillions of new bitcoins could suddenly be created.

That's a slightly strong perspective; it is not impossible; it is merely extremely hard.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#117

Post by eric_cc »

matheusmoreira wrote: post #109
eric_cc wrote: post #90

Earlier quoted context omitted.

LUNA minted trillions of brand new tokens within the span of a day or so rendering the token worthless. This is due to the way LUNA was tied to the algorithmic stablecoin UST. It was a true ponzi. BTC's max supply is capped and the release schedule of new coins is fixed and predictable. There is no possible way that trillions of new bitcoins could suddenly be created.

> There is no possible way that trillions of new bitcoins could suddenly be created. There absolutely is: fractional reserve banking. Exchanges are already operating that way. They offer loans, savings accounts and everything.

> There absolutely is

Banks and/or exchanges cannot create more bitcoin.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#118

Post by jpmattia »

caymanjim wrote: post #101
jpmattia wrote: post #81

Earlier quoted context omitted.

> Only 3.87% of Tether was backed by dollars For comparison: Citibank had only 11.73% Tier 1 capital in their 2021 report: https://www.citigroup.com/citi/investor/quarterly/2021/ar20_... Couldn't find a breakout of their Tier 1, but it includes high-quality credit items as well, so actual dollars is well below 11.73%. So in other words: SiliconAngle.com is writing clickbait and doesn't understand modern banking.

Real banks practice fractional-reserve banking, where they are required to hold a percentage of assets as cash or central bank deposits. It's well-regulated and diversified. It's audited. Individual account holders' deposits are insured (FDIC in the US). This is all well-known and understood and reliable. Runs can still happen, shady accounting practices can still happen, and sometimes banks fail. Sometimes they fail…

> They claim that 100% of the assets are backed by US dollar cash deposits.

Still? (ie link?)

All I see is: “All Tether tokens are pegged at 1-to-1 with a matching fiat currency and are backed 100% by Tether's reserves.” (link here: https://tether.to/en/transparency/)

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#119

Post by eric_cc »

matheusmoreira wrote: post #102
eric_cc wrote: post #69

Earlier quoted context omitted.

> 'this is good for bitcoin' A total ponzi scam coin crashed. This IS good for Bitcoin. Bitcoin is not Luna nor is it one of the thousands of other garbage scam coins. The faster those coins are proven scams the better. Too many people falsely equate "Bitcoin === Crypto".. or "a fan of bitcoin is a fan of all crypto". So I'd bounce this back to you: How is Luna's Ponzi crash NOT good for bitcoin?

> Too many people falsely equate "Bitcoin === Crypto".. or "a fan of bitcoin is a fan of all crypto". It pretty much is. I can open the price graph for any coin and assume the bitcoin movements are similar. Small dip in bitcoin price? Alts get destroyed. Even ethereum gets destroyed.

Sure price movements are in sync during general risk on/off pressures.

Same can be said about categories of companies in the stock market. e.g. SAAS companies, oil companies, etc move together..

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#120

Post by matheusmoreira »

eric_cc wrote: post #117
matheusmoreira wrote: post #109

Earlier quoted context omitted.

> There is no possible way that trillions of new bitcoins could suddenly be created. There absolutely is: fractional reserve banking. Exchanges are already operating that way. They offer loans, savings accounts and everything.

> There absolutely is Banks and/or exchanges cannot create more bitcoin.

Sure they can. You deposit 1 BTC, they loan it out to someone else. Boom, 2 BTC.
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