181–190 of 359 posts
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Couldn't they do it partially by betting that not all their customers would withdraw their funds simultaneously? Lot of less technically inclined people seem to keep their coins on one exchange like Coinbase
Good point. I am taking for granted that people will have their coins in their wallets, and lot just leave them up on an exchange.
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Because you can't lend out a Bitcoin you don't have, unlike fiat currency.
This is like saying you can't lend out a dollar bill you don't have. It's strictly true, but doesn't accurately represent how the banking system work. The $1,000 dollars in my Charles Schwab account don't correspond to 1,000 physical dollar bills somewhere. They are simply a number in a database somewhere. When I go and withdraw that money, I get back a random selection of $1 bills that other people have deposited. A…
Rising complexity of financial instruments? Check. Uncertainty about the capital backing of a booming market? Check. FOMO fever? Check. Where have I seen this before?
The sheer scale of these potential frauds - including the total ambiguity of massive $ raised for ICOs is not only consistent with the shenanigans of the .com - it's much worse. In .com - companies were creating value, and we all assumed people would pay for 'email' - turns out consumers would not - so many businesses failed, and there was a stampede out of equities. All of this coin and ICO fraud, including 'regular…
I'm not sure but, isn't this how the real banks operate, too? For example let's take a legal, legit, Bank named X in a country. If all the account owners wanted to retrieve their money, at the same time: can that bank serve that demand? Because normally for every 1 dollar deposited inside, bank can give away 5 dollars worth of credits to other people. (the ratio changes in every country probably). So accusing a virtu…
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Naive question: when an exchange sells, I assume they can decline to buy if they don't have a buyer or too much inventory? For example, if suddenly everyone wants to sell BTC, the price would drop, at which point the exchange could buy the BTC at a much lower price, or not buy at all? (unless they commit fraud, massively purchase BTC without having the actual money to back it, then not be able to wire money out of ou…
The exchange doesn't sell/buy. It just connects the buyers/sellers. There are brokers that do that but you can't call them an exchange. I also think regulation prevent exchanges from trading on their own exchange to avoid front-running and since they have lots of information about the users/deposits/etc...
You acknowledge that the quoted Buy Price Conversion Rate may not be the same as the Sell Price Conversion Rate at any given time, and that Coinbase may add a margin or “spread” to the quoted Conversion Rate.
When something doesn't make sense, usually it's because information is missing. Every market participant knows that Tether doesn't prove their reserves, and yet the market exchange rate to USD stays in a tight band between 0.98 and 1.02 across multiple exchanges. If the market doesn't trust Tether, then it should trade at a deep discount to USD, not at parity. Similarly, the conventional wisdom says cryptocurrencies…
the market is extremely illiquid. even if you know it's a scam you have few options if you want to cash out. you can trade bitcoin for cash balances at various exchanges but actually withdrawing those balances is subject to miniscule daily/monthly withdrawal limits and if there's a run on the market those exchanges will almost certainly collapse. there's no significant over the counter market. you can swap your bitco…
Afaik Bitstamp doesn't have any withdrawal limits for verified users.
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People who want a liquid USD tethered asset on many exchanges and aren't needlessly paranoid over absurd conspiracy theories that have yet to present a single ounce of real evidence.
Bitfinex is also lacking in evidence when it comes to showing that Tethers are backed by USD.
For all the bad press that Bitfinex gets, they're the only exchange that I know which lets you sign up for an account and start depositing, trading and withdrawing cryptocurrencies in less than 10 minutes. At least when my money is on Bitfinex, I know that I can take it all out at any time... With that kind of liquidity, I wouldn't care if Bitfinex was owned and operated by a colony of wild monkeys. I don't care if t…