Tether loaned USDT to investors and illegally traded in New York, says NYAG

Post by gerikson » Wed, Jul 10, 2019, 12:58 PM UTC

cmmeur01 wrote: post #94

arcticbull wrote: post #85

Earlier quoted context omitted.

Tether has not worked for years, they say on their website they're not redeemable for dollars ever. Yes, I suppose by that metric chuck-e-cheese tokens work too, but you'd have the same luck trying to get your cash back out of either. It's "worked" on a hope and a prayer because crypto-to-crypto exchanges who can't achieve AML/KYC compliance rely on it. How else are the narcos and the sanctioned supposed to launder t…

> How else are the narcos and the sanctioned supposed to launder their proceeds? HSBC seems like a fine choice no?

Post by koolba » Wed, Jul 10, 2019, 1:52 PM UTC

giaour wrote: post #99

koolba wrote: post #9

Earlier quoted context omitted.

The reason is when you have some other crypto holding and you want to close out your position but not have any reportable tax or legal liability. Of course you’re trading one set of liabilities and legal ramifications for a whole new set. Plus a hell of a lot of counter party risk.

Receiving the proceeds of the sale of one crypto currency in another crypto currency doesn't magically wipe out your tax liability. Your capital gains are still taxable, just as they would be if you bartered stocks without first selling your holdings.

Post by michaelt » Wed, Jul 10, 2019, 2:36 PM UTC

repomies691 wrote: post #74

gerikson wrote: post #69

Earlier quoted context omitted.

The main issue is what will happen when holders of USDT try to redeem them. Tether says it's immune to a bank run, because they have the entire outstanding amount of USDT (3.83B at time of writing) is backed 74% with USD. If you believe that a company without access to banking actually has 2.8B USD available for disbursement, then you are more optimistic than I am.

I'm just saying that tether has worked for years, and the peg seems to be still there. All those years also people have been saying that tether will lose its liquidity any moment. Might be but tha market data says what it says. As I said I haven't used tether and highly probably will never use it - I don't have any use case, bitcoin is enough for me. However if I had some use-case for moderate amount and months of ti…

  I'm just saying that tether has
  worked for years, and the peg
  seems to be still there.

Post by dwild » Wed, Jul 10, 2019, 3:16 PM UTC

beefield wrote: post #91

repomies691 wrote: post #68

Earlier quoted context omitted.

The majority of markets don't care if it is 100% backed, like they don't care when their bank does fractional reserve. They care about whether the USD peg will last within their timespan they plan to use tether. One of the most common advertised applications for tether is arbitrage between exchanges. There it hardly matters whether tether has 100% reserves, what matters if the peg stays within the days that you are d…

> The majority of markets don't care if it is 100% backed, like they don't care when their bank does fractional reserve Fractional reserve banks' deposits are backed more than 100% with more or less liquid assets. That's why nobody cares if a bank does fractional reserve. With tether there is no reason to believe there is even close to 100% backing. Unless you count as a reason an unverified claim that they are backe…

Post by beefield » Wed, Jul 10, 2019, 3:31 PM UTC

beefield wrote: post #118

dwild wrote: post #117

Earlier quoted context omitted.

> with more or less liquid assets What's more liquid than cash itself? I also have an hard time it's backed with MORE value and whether that value is fictional or not. The 2008 crash has shown that it wasn't actually backed by much.

"Or less" Any bank with assets worth less than liabilities is bankrupt. You may not believe it, but regulators that allow bank to operate and any one holding bank equity with stock price above zero believes that bank's assets are worth more than liabilities. There you are right that it is possible that tje value of the bank's assets may decline fast, but normally the assets exceed deposits quite significantly as depo…