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Top stablecoins shed $7B in May as traders redeem tokens en masse

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Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#271

Post by the_snooze »

Paradigma11 wrote: post #177
chii wrote: post #27

Earlier quoted context omitted.

> The interesting idea behind crypto once was to have a totally different system. the problem with this idea is that this idea of a "different" system is just merely going to evolve back into what we have today. The fundamental needs of a financial system doesn't change much, and what we have today is fit for purpose (mostly - there's efficiency to be had and red tape to cut).

In my opinion crypto (i am talking about PoS with smart contracts) is about having a decentralized open source/standards cloud for financial services/ transactions. That opens up many possibilities but everything has been completely drowned out by VCs starting defi ponzi schemes and other shenanigans.

The problem is that there's adverse selection going on here: people who aren't running ponzi schemes and other shenanigans are generally content with the regular banking system, so scammers are disproportionally present in the crypto world. Given that environment, it's mostly risk and little benefit for legit users in crypto.

The killer app for decentralized finance so far is sidestepping laws. No wonder it's a den of snakes.

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#272

Post by sireat »

Jommi wrote: post #184
vladgur wrote: post #28

Earlier quoted context omitted.

I was able to send funds from US directly to a bank account of my friend in Ukraine near instantly for low single digit percent and I could do the same using western union(to my surprise). All without a fear that my currency will drop 10-20% in a day. Now about decentralization, I believe that most people hold their transactional crypto funds in a handful of exchanges and thus the dream of decentralized crypto transa…

You can do this w/ crypto but pay only a few cents. I can show it to you if you want.

I am extremely skeptical that it will only cost few cents. (I've sent and received BTC in early 2010s)

On ramp and off ramp to fiat will kill you - whether through transaction fees or through slippage.

Let's say I am in US with 10k USD cash and I want a family in Ukraine (let's say somewhere safeish like Lviv) to have that 10k USD in hand.

Crypto is going to be more expensive than Western Union/Transferwise/SEPA/regular bank transfer/courier through friends.

That is the problem with crypto transfers - sure most crypto coins can be transferred cheaply.

However that "cheapness" only works as long as you stay in crypto verse.

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#273

Post by ValentineC »

hiq wrote: post #67
ur-whale wrote: post #14

Earlier quoted context omitted.

> while BUSD and USDC have grown more. If I am not mistaken, USDC (coinbase) is properly and regularly audited for proof-of-reserves? Not so sure about Binance though. But at any rate, if capital starts to migrate to audited stablecoins from POS (and by that, I don't mean proof of stake) like Tether, sounds to me like a good thing.

> USDC (coinbase) is properly and regularly audited I've only found attestations just like USDT, where did you see an audit?

Gemini Dollar (GUSD) might be one of the few stablecoins that supposedly have audits backing them:

https://www.gemini.com/dollar

I don't have any loyalty to a coin, so I'd love it if someone could say something against them so I can weigh the risks appropriately. :)

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#274

Post by marvin »

unityByFreedom wrote: post #100
Animats wrote: post #25

The big question with Tether has been, if they are holding commercial paper, whose commercial paper? Traders who deal in commercial paper of real companies that do real stuff don't see Tether present in that market. The dollar amounts are too big to hide. The suspicion is that their "commercial paper" is high-interest loans to other cryptocurrency companies. With the whole crypto sector in decline, those loans are at…

> This is how you get a 2008-type crash - loans which seem to be unrelated but are tied to a common market. How does this happen again 15 years later? Is it because we ineffectively dealt with 2008? A result of the repeal of Glass-Steagall? Or have we over regulated banking to the point the miscreants went underground to build things like crypto? I don't get it. Crashing over and over doesn't seem good for anyone.

> How does this happen again 15 years later?

It's human nature to create and participate in systems that are untenable over time but are tempting for short-term speculation.

Normally, in advanced economies, we try to use regulation to prevent or limit these events. But crypto explicitly avoids regulation, so of course it's going to pop up there. It's got nothing to do with not cleaning up after 2008.

Cryptocurrency is a new asset class, of course it's going to go through some of the painful learning experiences that traditional finance has. I've been saying since 2013 that we're going to see the exact mistakes of finance repeated with cryptocurrency.

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#275

Post by giaour »

uwuemu wrote: post #106
somebodythere wrote: post #95

Earlier quoted context omitted.

You are right. When you trade crypto->crypto, the IRS views it as if you traded crypto->USD then USD->crypto.

so when you buy 1 btc for $30k, trade the btc for 100 of bscoin, bscoin rises to 50 bscoin pet 1 btc, you change back to btc, now you have 2 btc, but the next day big crash occurs and 1 btc is worth just 10k... you cash out and there you have it, a $10k loss... but, you're supposed to pay the tax man on the bscoin -> btc trade? That makes no sense. And then what, you'll want that tax back because of the loss? More BS…

This is also what happens when you buy and sell stocks or bonds, FWIW. Each sale is a taxable event, even if you receive payment in the form of a different stock or bond.

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#276

Post by jallen_dot_dev »

lupire wrote: post #231
grey-area wrote: post #140

Earlier quoted context omitted.

Technically, isn’t selling one asset and buying another precisely the definition of a taxable event? I don’t see how tether helps you avoid taxes unless you’re going to lie about your transactions and hope nobody notices.

You don't report income on every item you shuffle. In the spirit of US law (since crypto is t precisely classified), if you are a professional trader, you only pay taxes on your overall annual trading profits, not each individual trade. Same as how a a retail store doesn't have gains and losses on every individual item in inventory.

You've never heard of a 8949, have you?

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#277

Post by dropnerd »

zht wrote: post #252
dropnerd wrote: post #153

Earlier quoted context omitted.

i pay my taxes. i make money providing liquidity between eth and usdc. when i'm not lp'ing, i see no reason to switch to usd so long as us-based attestations continue to be solid. the opportunity cost of being in usd on coinbase is missing lucrative nft deals.

How solid can an attestation be vs an audit?

audit is obviously better, am confident that tether will not be the first to introduce an audited stablecoin

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#278

Post by whimsicalism »

adgjlsfhk1 wrote: post #267
whimsicalism wrote: post #226

Earlier quoted context omitted.

> crypto likely will have higher transaction fees If you are sending a fair bit of money, I very much doubt that.

most transactions are small. crypto might put pressure in banks to lower transaction fees for large transactions, but that is a very niche benefit

My impression was remittances were typically in the hundreds of dollars.

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#279

Post by giaour »

uwuemu wrote: post #96
mellavora wrote: post #90

Earlier quoted context omitted.

Please check your local regulations on this. What Uwuemu says makes sense, but tax law does not have to make sense. I might be wrong, but I believe the IRS views every transaction as a taxable event. Crypto -> crypto included.

That's nice and all and I don't live in the US, but just imagining the way you would track all of this makes me shiver. Anyways, from my point of view (and also many countries point of view), the entire point of realized gain tax is to be the income tax for stock traders... i.e. income is what the government typically collects taxes on... when I convert BTC to DOGE (or whatever), there is no income, so there is nothi…

> when I convert BTC to DOGE (or whatever), there is no income

That conversion is the sale of property. The IRS doesn't care whether you receive payment for your BTC in DOGE, USD, or corn futures; you divested funds from BTC, and the difference between what the BTC was worth at the time of acquisition VS sale is a capital gain or loss.

Re: Top stablecoins shed $7B in May as traders redeem tokens en masse

#280

Post by aaaaaaaaata »

CTDOCodebases wrote: post #213
Animats wrote: post #25

The big question with Tether has been, if they are holding commercial paper, whose commercial paper? Traders who deal in commercial paper of real companies that do real stuff don't see Tether present in that market. The dollar amounts are too big to hide. The suspicion is that their "commercial paper" is high-interest loans to other cryptocurrency companies. With the whole crypto sector in decline, those loans are at…

Why would anyone buy Tether? Because the most liquid trading pairs and futures use USDT. The same companies who borrow USDT from Tether happen to be the same people who run exchanges or act as market makers.

They did — is that still true?

Will it still be true next month or next year?

Seems to me the slow abandonment of Tether has become faster.

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