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Binance freezes withdrawals of stablecoin USDC as investors pull $2B

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Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#301

Post by jqpabc123 »

japoco wrote: post #38
jqpabc123 wrote: post #5

every digital dollar of USDC can always be exchanged 1:1 for cash. Well ... maybe not always ... and never without fees attached.

This is not what is happening here, the USDC peg to the dollar has nothing to do with this. The problem is that Binance converts every stablecoin you deposit there to BUSD, and so if you want to withdraw say USDC or USDT even they’d have to convert them, which is apparently what they’re having trouble to do.

the USDC peg to the dollar has nothing to do with this.

I never said it did.

The problem is that Binance converts every stablecoin you deposit there to BUSD

The real problem is that Binance can do whatever *they* want with your deposits --- including refuse to return them.

The real problem is that the crypto market is about as far removed from *trustless* or *decentralized* as is imaginable or possible.

The real problem is that people who say they don't trust government will readily trust FTX or BlockFi or Voyager or Celsius or Binance or Bitfinex --- all of which have been shown to be far less worthy of it in my opinion.

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#302

Post by q1w2 »

9935c101ab17a66 wrote: post #284
crypt1d wrote: post #168

USDC withdrawals have been enabled again, but I don't suppose that's HN front-page worthy as much as the panic inducing titles. https://twitter.com/binance/status/1602708590271385600?s=20&...

? Withdrawals working isn’t newsworthy — that should always be the case. But when a “financial institution” in a notoriously unstable market segment prevents users from withdrawing their own funds, then of course its going to be a big story (as it should be!).

Withdrawals RESUMING after stopping is just as newsworthy.

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#303

Post by dheera »

aclatuts wrote: post #172
dheera wrote: post #152

Earlier quoted context omitted.

Presumably they just need to wait until 9am when people at work, so I wouldn't consider that a default. If they say they need a few hours at 9am, they've defaulted. It would be a big "ha" if they couldn't get them together by 9:05am because they've done shady things with your money.

Most Canadian banks need a few business days just for 5 thousand and above in cash. There is more zeros in bank accounts there is physical money in circulation.

Yep it's basically legalized fraud, we take it for granted that that's how the system works, but still fraud.

Rich people like banks can basically create money that doesn't exist, while average Joes cannot.

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#304

Post by rufusroflpunch »

thatguy0900 wrote: post #178
rufusroflpunch wrote: post #113

Earlier quoted context omitted.

It’s not really any less of a dollar than any other dollar is. All of our digital dollars are just bank liabilities. Circle and Tether are just banks with dollar liabilities. Their liabilities can be transferred on crypto networks rather than traditional bank wires.

It is less of a dollar, because I can say you can exchange it for a dollar when you can not, in fact, exchange it for a dollar when you try to,because I never had enough(or any) dollars. In the real world when the bank runs out of dollars the government will give me dollars instead.

I think that is a fair critique, but that will be coming at some point, very likely. Either a law requiring 100% liquid reserves, or a law bringing them into the FDIC system.

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#305

Post by rufusroflpunch »

rglullis wrote: post #131
rufusroflpunch wrote: post #113

Earlier quoted context omitted.

It’s not really any less of a dollar than any other dollar is. All of our digital dollars are just bank liabilities. Circle and Tether are just banks with dollar liabilities. Their liabilities can be transferred on crypto networks rather than traditional bank wires.

> Circle and Tether are just banks with dollar liabilities. But no regulatory oversight, and no chance for the common folk to prosecute or get their money back if they default. I am one of the resident crypto apologists here on HN, but there is no way that we should even try to accept what the big exchanges are doing. The whole point of crypto is to have systems that do not depend on "too big to fail" institutions, w…

Sorry, I did not mean to insinuate anything resembling cover for these stablecoins. I do not own any and I never would. In fact, I only own Bitcoin and I don’t keep any on any exchange at all. This is the only way I would ever recommend when interacting with cryptocurrencies.

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#306

Post by plugger »

crypt1d wrote: post #292
plugger wrote: post #280

Earlier quoted context omitted.

Yes, suprisingly people seem to react negatively to being frozen out of withdrawing their cash and those events are newsworthy?

Its a pretty big leap from "you cannot withdraw this particular stablecoin at the moment, use another one" to "you cannot withdraw your cash". Devil is in the details.

Isn't the stablecoin considered a financial instrument? The devil may be in the details, but the high level facts remain. People could not access financial instruments that they own, and that could be considered newsworthy.

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#307

Post by oneoff786 »

Yiin wrote: post #70
oneoff786 wrote: post #37

Earlier quoted context omitted.

Really it depends on why you didn’t / couldn’t.

It doesn't, if I give exchange a coin, no matter it's relative value fluctuations to other assets I should still be able to withdraw the same coin back.

What if they are stolen from you

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#308

Post by from »

KarlKemp wrote: post #181
HillRat wrote: post #142

Earlier quoted context omitted.

Turns out having a monetary union but not a fiscal one is really destabilizing when things go wrong!

The Euro was introduced 23 years ago. It has successfully weathered one domestic crisis in addition to the dot-com bust and the 2008 US banking meltdown. Its exchange value has been stable and the Eurozone economies have fared better than, for example, the UK. I'll take the Euro over any cryptocurrency any day, thanks.

https://data.worldbank.org/indicator/NY.GDP.PCAP.PP.KD?locat...

On a PPP adjusted basis Italy/Spain/Portugal are no richer than they were 20 years ago. They can no longer devalue their currency like they used to when they ran into trouble.

Re: Binance freezes withdrawals of stablecoin USDC as investors pull $2B

#309

Post by jacobsimon »

coliveira wrote: post #182
jacobsimon wrote: post #167

Earlier quoted context omitted.

Not trying to make excuses for any of these companies. I'm just saying, in the abstract, there are lots of reasons why an end user would want a stablecoin besides "avoiding regulations". Even if it weren't pegged to a national currency, there is value in having a digital currency that limits its volatility. Pegging to another currency is a shortcut for doing that w/o needing decentralized monetary policy.

Basically these people are trying to get the benefit of digital currencies without the downside of volatility. Somebody else will have to take the volatility risk. This is easy to do when the crypto currencies are going up in value, and almost impossible to do on the downside.

Maybe but not necessarily. I can log in to Coinbase and buy USDC with dollars in my bank account, use the USDC in a variety of decentralized applications or contracts, and then exchange my USDC for USD again via Coinbase. It’s similar to going to the bank and withdrawing cash, and it has no inherent volatility or downside risk.
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