What is the track on Winklevoss' proposal to a self regulation org for crypto currency exchanges?
U.S. Launches Criminal Probe into Bitcoin Price Manipulation
151–160 of 228 posts
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#152Earlier quoted context omitted.
If there was a problem redeeming Tether for USD, you'd expect that the market price distortion of Tether. But it hasn't[1] https://www.tradingview.com/chart/?symbol=POLONIEX:USDTUSD >they've created 2.8 BILLION USDT Absolute numbers are meaningless and less eye catching when they're compared to the entire market. 2.8 ~ ~ Billion ~ ~ USDT is only 0.5%-0.8% of the market. Do you really think that a 300-500 billion doll…
> What can be said about Tether: it's a trusted third party that's vulnerable to fractional reserve What? Isn't the entire friggin point of Tether that it's _not_ a fractional reserve system? From their own FAQ (emphasis mine): > All tethers are pegged at one-to-one with matching fiat currency (e.g., 1 USD₮ = 1 USD) and are backed 100% by actual assets in our reserve account. https://tether.to/faqs/
I think by "vulnerable to fractional reserve," he means that since there is no way to transparently verify or audit their USD reserves, they could run a fractional system while claiming to be fully backed, like Mt Gox did.
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#153Earlier quoted context omitted.
> What can be said about Tether: it's a trusted third party that's vulnerable to fractional reserve What? Isn't the entire friggin point of Tether that it's _not_ a fractional reserve system? From their own FAQ (emphasis mine): > All tethers are pegged at one-to-one with matching fiat currency (e.g., 1 USD₮ = 1 USD) and are backed 100% by actual assets in our reserve account. https://tether.to/faqs/
I think by "vulnerable to fractional reserve," he means that since there is no way to transparently verify or audit their USD reserves, they could run a fractional system while claiming to be fully backed, like Mt Gox did.
Ah. I guess that my reading was "vulnerable to [bank runs, due to] fractional reserve."
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#154Earlier quoted context omitted.
They mint Tether during market crashes because that's when there is the highest volume on USDT pairs, and when Tether needs to create tokens to maintain the exchange rate around $1. Have you read their whitepaper? Further, there is more proof that Tether has the funding to back up the USDT than proof that Tether does not have the funds: https://blog.bitmex.com/tether/ https://blog.bitmex.com/tether-addendum-new-finan…
Well, right on tether.to they say, and I quote: > Our reserve holdings are published daily and subject to frequent professional audits. All tethers in circulation always match our reserves. They've been around for years and the grand total of independents audits is 0 (zero). Sure, assumptions don't make rumors true but them flat-out lying about audits and transparency speaks louder than anything else and we're not ev…
> Sure, assumptions don't make rumors true but them flat-out lying about audits and transparency speaks louder than anything else and we're not even getting into how it took the Panama papers leak for the public to find out that several of the people in charge of Tether and the people in charge of Bitfinex being the same.
An interesting fact is that all of the original RealCoin/Tether founders (Brock Pierce, Reeve Collins, Craig Sellars) are now associated with a pair of connected blockchain startups: BLOCKV[1] and vAtomic[2].
[2]: https://www.vatomic.io/ (this is, incidentally, another of vAtomic's founders, "accused of paying $2.5 million of bribes to two technology executives at the bank, so they would arrange $10.4 million of contracts to inflate his company’s revenue." https://www.reuters.com/article/us-servicemesh-cba-bribery/e...)
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#155Earlier quoted context omitted.
Nobody knows why the value of BTC decided to spike like it did last year. Just like nobody knows why it is sliding back down to earth. It is one of the many reasons it makes a piss-poor store of value. (Of course the answer to the spike could very well be “somebody fired up the tether printer” plus “super shady exchanges did tons of wash trading/oughright made up fake transactions”.
It is indeed a piss-poor store of value for people who have high time preference, but unmatched for those with low time preference.
There is no insane investment you can't say that about. Those metallic-cover special issue Marvel X-Men comics they used to "limited collector release" in the early 90s will eventually be of enormous value to archaeologists in the future, too.
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#156[deleted]
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#157Earlier quoted context omitted.
It makes perfect sense. If many people are trying to BUY USDT (increasing demand for USDT) the price of USDT will increase. Tether tries to prevent this by printing more USDT (increasing supply). They are not "magicking" Dollars, they are magicking a commodity (USDT) pegged to Dollar. I'm not saying that I'm a big Tether fan or anything. However to say that it "doesn't make sense" when they print more Tether during m…
> It makes perfect sense. If many people are trying to BUY USDT (increasing demand for USDT) the price of USDT will increase. Why? It's worth exactly one dollar. Which they have in an account. That's the point. The price of the other cryptocurrency will come down, and the value of USDT compared to that cryptocurrency will indeed rise, as it should when people want to sell to a market where there's more demand on doll…
There's zero proof they have anything in there account.
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#158Earlier quoted context omitted.
It worked fine. I don’t know what you’re talking about.
Americans got screwed and no banking executives went to jail. It didn't work. It's one of the reasons Bitcoin was created, per the first transaction in the blockchain.
Fractional reserve banking is not what failed in the financial crisis. Multiple things failed, including credit ratings, mutual funds/pensions/etc investing in high risk investments, etc. The biggest risk people think of for fractional reserve - they won't have the money when you need it, a run on banks, etc - didn't really happen in the states in any significant fashion.
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#159Earlier quoted context omitted.
Central banks are in the business of market manipulation via interest rates, and money supply. This is to control growth and inflation so that business cycles are smoothed out to a degree.
The problem with that approach is that market cycles serve important purpose: they faciliate best allocation of our resources by ensuring that inefficient companies will go bankrupt. Smoothing those cycles out enables poorly managed companies to stay in business for way too long. Then, since there's a limit to a market manipulation that central banks can do we end up with one huge crisis, like Great Depression, or 20…
Inefficient and poorly run things die in down cycles but so do new things and innovative things. Efforts to innovate must usually burn money for a long time and are more vulnerable to downturns since in downturns people become more conservative.
Re: U.S. Launches Criminal Probe into Bitcoin Price Manipulation
#160Earlier quoted context omitted.
If there was a problem redeeming Tether for USD, you'd expect that the market price distortion of Tether. But it hasn't[1] https://www.tradingview.com/chart/?symbol=POLONIEX:USDTUSD >they've created 2.8 BILLION USDT Absolute numbers are meaningless and less eye catching when they're compared to the entire market. 2.8 ~ ~ Billion ~ ~ USDT is only 0.5%-0.8% of the market. Do you really think that a 300-500 billion doll…
The mechanics are probably this: suppose someone goes to Bitfinex to redeem 10million USDT into USD. Since Bitfinex is behaving fraudulently, they don't actually have the 10million USD they promised they would hold to back the USDT. But they do have the ability to issue new unbacked USDT. So they issue 11million unbacked USDT and use it to buy bitcoin. They sell the bitcoin for 10million USD on one of the exchanges t…
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