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Tether Critical Announcement

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Re: Tether Critical Announcement

#271

Post by darawk »

empath75 wrote: post #246
darawk wrote: post #166

Earlier quoted context omitted.

> I've read it a few times now, still can't find where they say they specifically created tether (the system) for this exact purpose. Keep in mind that the issuance of tether is not the creation of the complete tether blockchain/system (they are issuing new tether around the clock). > Bitfinex was cut off from the US financial system, which makes it impossible for them to clear USD-denominated wires...Their solution:…

Do you think that bitfinex didn't know they'd potentially have wire problems before being officially cut off?

I don't think they knew 1.5 years before.

Re: Tether Critical Announcement

#273

Post by darawk »

banderman wrote: post #265
darawk wrote: post #80

Earlier quoted context omitted.

...except that Tether long predates Bitfinex's wire issues. They're usable on many of the major exchanges (Bittrex, Poloniex, for example). Tether was explicitly created for the purpose of equalizing prices across exchanges. It's indeed possible that they're insolvent, but there is no real evidence of that, just lots of people speculating incessantly without much justification. Basically everything about the parent c…

Who owns and operates Bittrex and Poloniex? How are the licensed? Do they keep customer funds segregated from operating funds?

Bittrex is owned and operated by US actors. You can go talk to them in their slack. They're on their with their real names, and they all have linkedin profiles with real work histories at US companies.

Poloniex is owned by a guy named Tristan D'Agosta. He's a little bit less easy to track down, but does seem to be a real, known person with a real history and life.

I don't know how they each separate customer and operating funds, but i'm sure the Bittrex guys at least would probably be happy to tell you if you ask in their Slack channel, assuming they don't consider it a security risk.

Re: Tether Critical Announcement

#274

Post by darawk »

joosters wrote: post #228
bitreality wrote: post #206

Earlier quoted context omitted.

At the time Bitfinex was hacked, they automatically converted the "hacked" BTC balance to USD. It was around $650 I believe at the time of the hack. It would be unfair to measure the hack in today's BTC value because they converted the liability in customers' accounts in USD.

Tell that to the Mt Gox account holders... they don't seem too happy that their BTC claims have been converted to JP¥

They were plenty happy with it when BTC was crashing. People just like to whine. Converting to JPY in MtGox's case and USD in Bitfinex's case was the reasonable thing to do. Denominating massive debts in cryptocurrency is an insane thing in a market this young and volatile.

Re: Tether Critical Announcement

#275

Post by darawk »

simias wrote: post #188
ActsJuvenile wrote: post #177

Earlier quoted context omitted.

Only a shill would claim to be happy with a 30% haircut scenario. Flagged.

They said "They paid me back in full" so I assume he did not lose the 30% in the end? Admittedly I'm not sure I understand what they mean. I also wish that "everybody I disagree with is a shill" meme stayed in 4chan and reddit, it's incompatible with reasonable discussion.

What I mean is that when the hack occurred I lost 30% of my funds. However, I received BFX tokens equivalent to the amount I lost. Eventually, as Bitfinex continued operating and accumulating fees from operations, they paid me back 1:1 USD for BFX tokens they had given me as debt.

So, I did lose the time-value of that money (they didn't pay me interest on it), and I didn't get paid back in Bitcoin or Ethereum, which would have been more money, but i'm still very happy with how they handled it. I think it was the most reasonable and honest solution to the problem that they had available to them at the time.

Re: Tether Critical Announcement

#276

Post by MrRadar »

mancerayder wrote: post #258
ActsJuvenile wrote: post #176

Earlier quoted context omitted.

No one is going to deposit 600 mill in a hacked exchange via Tether crypto-Hawala using Taiwanese shell bank accounts. People with real money would instead wire the funds to Gemini or ItBit or even a terribly managed company like Coinbase. KISS

What's wrong with Coinbase? (I ask as a naive fool with a bit of money stored there).

Mostly that if anything goes wrong their support tends to be incredibly unresponsive. Also make sure you're not using SMS-based 2-factor authentication with them since there's a long history of people getting their phone numbers stolen and then their Coinbase accounts drained within minutes.

Re: Tether Critical Announcement

#277

Post by sethev »

darawk wrote: post #166
askmike wrote: post #155

Earlier quoted context omitted.

> Read the post, man, very first paragraph: I've read it a few times now, still can't find where they say they specifically created tether (the system) for this exact purpose. Keep in mind that the issuance of tether is not the creation of the complete tether blockchain/system (they are issuing new tether around the clock). > That's true, except you probably have never tried to actually execute that kind of arbitrage…

> I've read it a few times now, still can't find where they say they specifically created tether (the system) for this exact purpose. Keep in mind that the issuance of tether is not the creation of the complete tether blockchain/system (they are issuing new tether around the clock). > Bitfinex was cut off from the US financial system, which makes it impossible for them to clear USD-denominated wires...Their solution:…

Lots of people use git as a solution to their source control problem who only started writing code after it was invented.

Re: Tether Critical Announcement

#278

Post by 3pt14159 »

darawk wrote: post #80
patio11 wrote: post #4

If you haven't been following along, here's why this matters: Tethers is a sole-source cryptocurrency, pegged to the US dollar. Bitfinex produces it, though they're cagey (some would say outright lying at times) about the level of involvement. The primary purpose of tethers is money laundering, even more so than cryptocurrency generally. Bitfinex was cut off from the US financial system, which makes it impossible for…

...except that Tether long predates Bitfinex's wire issues. They're usable on many of the major exchanges (Bittrex, Poloniex, for example). Tether was explicitly created for the purpose of equalizing prices across exchanges. It's indeed possible that they're insolvent, but there is no real evidence of that, just lots of people speculating incessantly without much justification. Basically everything about the parent c…

I've been in Bitcoin for over 7 years. This type of back and forth is exactly what happened to Mt Gox. And you know what? My friend got the fuck out of Mt Gox before it burst.

When you have to choose between following a pre-bankrun rumour or following unsubstantiated pushback, follow the rumour. It costs you maybe 5% to get out vs 100% if you're wrong and banks / money holders compete on assuring people that there is less risk with their solution so if Tether can't provide assurance then that is their problem. Cut and run.

Re: Tether Critical Announcement

#279

Post by illumin8 »

foxhop wrote: post #147
shobith wrote: post #139

Earlier quoted context omitted.

I understand your sentiment. However, I think about it slightly differently -- crypto currencies (and their likes) are just an attempt to replace man-power with computer-power. We need someone to enforce the rules without human intervention, hence, freeing up more people to do stuff that doesn't involve managing the abstraction of money. edit: When we imagine "mining" in this realm, it'd help to think in terms of min…

Most of the other layers of abstractions and tech are still present. We literally are mining coal to burn it in powerplants to energize servers and GPUS to waste clock cycles to find "coins". The world is the realm and how we use its people and resources matters, especially when its to just create more entropy faster then natural systems.

The purpose of bitcoin mining is not to "find coins," although the mining reward might make it seem like that. The purpose is to provide enough hashing power to the network to cryptographically verify transactions using a consensus algorithm, which prevents any single actor from double-spending. Without enormous hashing power, the network would be vulnerable to a 51% attack by a sophisticated attacker.

This is not to say that proof of work is the best consensus algorithm, but given it's age, the fact that Bitcoin has stood up so well to the test of time is a testament to it's viability as a consensus protocol.

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