Tether loaned USDT to investors and illegally traded in New York, says NYAG • Hacker News Board

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

#121

Post by FireBeyond » Wed, Jul 10, 2019, 4:17 PM UTC

Afforess wrote: post #55

duxup wrote: post #26

Earlier quoted context omitted.

"vaguely sketchy" What does that mean? That doesn't sound like a positive thing.

Apparently, there originally was something like 60 cents backing each $1 of tether. Then bitifinex needed the money to cover its legitimate business, so they swapped the tether dollars with an equal amount of dollars in a frozen bank account. And the account was frozen because the _bank_ it was deposited in has had all its accounts frozen by numerous investigating governments. After the swap, Bitfinix then had to be…

Let's not mention that the same two people signed the loan documentation on both sides of the transaction. Funny for all the denials that Tether and Bitfinex have any relationship.

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

#122

Post by dmix » Wed, Jul 10, 2019, 4:46 PM UTC

duxup wrote: post #95

dmix wrote: post #34

Earlier quoted context omitted.

> it means they are less likely to have their funds blacklisted

Why would being "sketchy" do that?

Being sketchy means Tether are less likely to do that (blacklist) despite claiming they do. So some people are attracted to that type of organization…so they won’t get their coins blacklisted for whatever reason.

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

#123

Post by dmix » Wed, Jul 10, 2019, 4:52 PM UTC

seibelj wrote: post #96

dagenix wrote: post #58

Earlier quoted context omitted.

seibelj has a link to his twitter account in his profile. On that account, its quite clear he works for Circle. IMO, it's pretty unethical to promote this type of investment without revealing that conflict of interest. It's also par for the course with crypto coins.

USDC is not a security, anyone can buy it accredited or not without going to a broker dealer. It's an asset backed stablecoin and you don't buy it as an investment, it's a tool to tokenize USD to get it onto the crypto network rails. It also is the #2 stablecoin by marketcap. I will disclose that I know way more about this industry than all of you commenting that I'm "shilling" as if this is some altcoin scam. Welcom…

FWIW I didn’t find your comment to be ‘shilling’, particularly as you seem to be the crypto technical guy. Most importantly I dont think you sought to gain anything by posting that. I doubt some random comment on HN is shifting the needle on your USDC holdings.

Plenty of people promote their own work on HN as it’s their area of expertise.

But crypto has some baggage attached so people get sensitive.

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

#124

Post by tomatocracy » Wed, Jul 10, 2019, 5:27 PM UTC

colechristensen wrote: post #84

dagenix wrote: post #58

Earlier quoted context omitted.

seibelj has a link to his twitter account in his profile. On that account, its quite clear he works for Circle. IMO, it's pretty unethical to promote this type of investment without revealing that conflict of interest. It's also par for the course with crypto coins.

It is enormously difficult to promote securities legally. Disclosing a conflict of interest is the tip of the iceberg.

Yes. And even if you do all that and stay on the right side of the regulators, you’re not out of the woods. You then have to do additional work to minimise the chance that investors successfully sue you later too if they lose money.

And you need to do all that in every jurisdiction you touch, plus likely the US even if you don’t touch it.

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

#125

Post by pfisch » Wed, Jul 10, 2019, 5:54 PM UTC

deadbunny wrote: post #108

pfisch wrote: post #73

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. Banks are insured, and in general they haven't failed for the last like 100+ years. I do think what you are saying about usdt is mostly true though, however if(when) usdt does fail the entire market will take a dive off a cliff. So even if your assets are in other cryptos it still represents a syste…

> Banks are insured, and in general they haven't failed for the last like 100+ years. Thanks to massive bailouts you mean?

The mechanism really doesn't matter as long as they are secured.

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

#126

Post by Macross8299 » Wed, Jul 10, 2019, 6:24 PM UTC

llamataboot wrote: post #60

Tether has been an openly fraudulent enterprise since the beginning. Pretty much anyone with any experience in financial securities and even passing knowledge of crypto was raising red flags, including on this website. Never wanna blame the victim, but kinda feel like anyone with any due diligence here was just hoping for casino rallies and didn't believe what they were being sold.

I can't speak to how well-backed their reserves are but the idea of a "wildcat bank" [0] almost certainly comes to mind whenever somebody mentions tether.

Everything old is new again.

[0]: https://en.wikipedia.org/wiki/Wildcat_banking

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

#127

Post by floodyberry- » Wed, Jul 10, 2019, 7:21 PM UTC

seibelj wrote: post #96

dagenix wrote: post #58

Earlier quoted context omitted.

seibelj has a link to his twitter account in his profile. On that account, its quite clear he works for Circle. IMO, it's pretty unethical to promote this type of investment without revealing that conflict of interest. It's also par for the course with crypto coins.

USDC is not a security, anyone can buy it accredited or not without going to a broker dealer. It's an asset backed stablecoin and you don't buy it as an investment, it's a tool to tokenize USD to get it onto the crypto network rails. It also is the #2 stablecoin by marketcap. I will disclose that I know way more about this industry than all of you commenting that I'm "shilling" as if this is some altcoin scam. Welcom…

You definitely come across as an impartial subject matter expert!

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

#128

Post by magnamerc » Wed, Jul 10, 2019, 8:51 PM UTC

gerikson wrote: post #114

magnamerc wrote: post #104

Earlier quoted context omitted.

You could open up a prediction market on Augur.

Interesting! Can Augur manage USD via escrow?

I believe Veil (which is a dapp built ontop of the Augur protocol) supports DAI, which is a decentralized stablecoin built by MakerDAO.

The only market on Augur right now for USDT is the following one: https://predictions.global/augur-markets/will-tether-usdt-tr...

There's no liquidity though, which is a problem obviously.

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

#129

Post by h1d » Thu, Jul 11, 2019, 12:14 AM UTC

ForHackernews wrote: post #56

human20190310 wrote: post #51

Earlier quoted context omitted.

Why would bitcoin spike?

Since it's very difficult to convert USDT into real USD, if people were desperately trying to exit their Tether positions, they'd likely do it by changing for other cryptocurrencies like bitcoin.

Why ignore any other negative impacts like, lack of confidence in crypto from USDT collapsing because crypto is still a Wild West having a random corp printing money at will and there will certainly be a group of people who will face huge loss when billions just evaporate and the impact all the exchanges take who are dealing with USDT? SEC is not going to like it and can probably lock ETF for a good while.

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

#130

Post by chx » Thu, Jul 11, 2019, 5:18 AM UTC

ryanlol wrote: post #109

chx wrote: post #80

Earlier quoted context omitted.

ROTFLMAO Are you serious? You need to establish presence at an exchange meaning you need to scan and send your ID to a company which more likely than not -- does QuadrigaCX ring a bell -- is run by scammers. Then you need to buy bitcoin and store it somewhere... and then send it to someone. The sending costs an unknown amount, takes an unknwon amount of time, the receiver gets something but none of you can predict ho…

>The sending costs an unknown amount, takes an unknwon amount of time, This is a downright lie. >the receiver gets something but none of you can predict how much that is actually worth by the time they receive it This is just misleading, the recipient gains control of the transmitted bitcoin almost instantly. Confirmation delays are known.

I do not lie.

> The sending costs an unknown amount

Here's you can see historic daily average Bitcoin transaction fees both in dollars per transaction and in satoshis per byte https://bitcoinfees.info/

> takes an unknwon amount of time

Here's the average time for one confirmation: https://coincentral.com/wp-content/uploads/2017/12/Screensho... here

> This is just misleading,

But it's not, there's a time delay between when you initiate exchanging your real money to scam money and the receiver finishes the exchange back and during that time bitcoin can move in any direction.