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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

#311

Post by birracerveza »

PKop wrote: post #242
shawabawa3 wrote: post #216

Earlier quoted context omitted.

As someone that holds a lot of stable coins (USDC, not USDT) The same reason you would hold dollars in a bank account. My local currency (GBP) is weak atm and falling against the dollar. I want to be able to use crypto services (easy transfers, buying/selling crypto, borrow/lend on DeFI), but I don't want any more exposure to the currently volatile crypto markets, so I hold a lot of USDC Some of that USDC is being le…

It's surprising how many times the question you are answering gets asked and people still don't get it.

Yeah but crypto is bad, so why would I buy crypto?

There's no reasoning to be had here.

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

#312

Post by luka-birsa »

I really wonder if USDT bashing will get old or will people finally get that USDT will not just disappear overnight. They've redeemed 11% of their total capitalization and nothing happened.

I despise shady accounting practices and I'm sure Tether is on par with a good american financial institution, but I highly doubt it they will ever default.

I know it's a long shot, but hear me out:

1. Their redemption process can be handled in a way to prevent an uncontrolled bank run. You can redeem 100.000 minimum, hence it's a not a retail bank run for sure. 2. They print the dollars for much of the old school crypto ecosystem, with all players acknowledging their importance. So unless the key players in the field want to take USDT down, it's not going down. Even the NYAG tried and gave them a penny fine instead.

And even the article here really lacks context. The USDT reedeming right now is tied to all the negative publicity in the media. I've traded through this current depeg (a week ago), that was purely speculative and generated by the panic. A twitter thread stared to report a depeg, and more and more people piled on the exchanges to swap USDT for BUSD and USDC. In the end a lot of USDT was redeemed, nothing happened, expect that some people made a lot of money on the panic itself (and the premium).

I've been hearing the same story for the past 6 years. USDT will fail, they don't have any backing, US will shut them down,.... And the world keeps on turning. Sorry to break it to you. Nothing is going to happen until key crypto players have a legit alternative that will keep the ecosystem alive.

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

#314

Post by timoth3y »

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…

> whose commercial paper?

Perhaps it's in the form of debt from exchanges. Tether could buy short-term notes from the exchanges paying them in Tether -- maybe at a slight premium to make sure the exchanges go along. The terms would stipulate that Tether could call the loan at any time allowing them to quickly pull Tether off the market as needed to maintain their peg.

How long the dance can go on would depend on the premium they've offered the exchanges and how much free Tether they've minted for themselves.

Obviously, this is all pure speculation.

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

#315

Post by FireBeyond »

web4 wrote: post #233
FireBeyond wrote: post #194

Earlier quoted context omitted.

If you're the kind of person that regularly wires six digit sums in and out of your personal account, I suspect that one, if not both of the following are true: 1) that you've chosen your banking institution with a view to being expedient in such transfers, and 2) are on a known basis with sufficiently senior branch/bank personnel as to help establish parameters with them on legitimacy of such transfers.

yep. the rich tend to be given access to better banking services than the poor: higher limits, direct line of contact with a bank manager, additional services. when your account reaches a certain wealth threshold the bank will step in to ensure you have a better experience than the poor. banking is a radically different design philosophy than a protocol where all addresses and transactions are treated equally regardl…

It is self-fulfilling in regards to your point though.

"Oh, that's not a useful system, because there are limits."

"Well, when you get near those limits the bank starts to work with you so those are still not roadblocks."

"Oh, well that's just because they prefer the rich to the poor."

No, you miss the point. At lower amounts, it's a non-issue because you're not hitting limits. At the point where you are hitting limits, it's facilitated to smooth those things. End result is that there should be few issues, regardless of amounts.

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

#316

Post by FireBeyond »

Grimburger wrote: post #297
FireBeyond wrote: post #192

Earlier quoted context omitted.

Yeah, about that. Used to be that you couldn't redeem unless you were a whale. Unless you weren't a US national. Unless you'd given 90-120 days notice. Unless there was a fee paid. People literally put up bounties hunting any successful redemption of Tether. Especially since, and this is as true now, as it was then: "Tether makes no guarantees, promises or arrangement that the Tether stablecoin is or will be redeemab…

You can redeem $0.30 worth of tether right here: https://trade.kraken.com/charts/KRAKEN:USDT-USD There's very good reason to do a lot of KYC and set limits on people who want to get USD for their USDT. The last person who tried to operate such a business was locked up in a US prison for nearly a decade. Good motivation to not deal with retail customers and the slow burn US justice system don't you think? https://www.…

> What you want to happen to void this criticism would get the Tether execs put in prison. Though I guess that's what some people here secretly want anyway.

I mean, it's not like they have, multiple times, lied to people about their financial backing, actively messed around with KYC and AML laws, and have had multiple judgments open against them, or their affiliations with other entities like Bitfinex, when they really were one and the same.

Oh wait, they HAVE done ALL of that.

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

#317

Post by xur17 »

FireBeyond wrote: post #190
tornato7 wrote: post #49

Earlier quoted context omitted.

With the crypto market cap at $1300B that sounds pretty reasonable to have 11-12% cash on hand

If only Tether and similar could show something, anything, an audit, that shows anything close to this. I almost typed audit-like. But I remembered they've pulled that shit before. "Attestations of balances" mean fuck-all when even back when they were denying the links between Bitfinex and Tether, the same people were countersigning loans between the two for both parties. Oh, they did claim that they had had an audit…

> If only Tether and similar could show something, anything, an audit, that shows anything close to this.

Tether isn't the only stablecoin. USDC, GUSD, DAI, LUSD, etc all have either attestations / audit reports (that are actually legitimate) or are overcollateralized with assets that can be seen on chain.

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

#318

Post by krzyk »

maccard wrote: post #309
krzyk wrote: post #284

Earlier quoted context omitted.

Why? You eventually have to pay it when you cash out (or buy service, goods with crypto). If you wait you loose tax returns for the amount you invested in crypto (with each year you have it halved). Basically this is the same as in case of stock market. You don't pay taxes until you sell stock. And here stock is whole crypto market.

> You don't pay taxes until you sell stock. And here stock is whole crypto market. No, each coin is equivalent to a stock. A transaction involving swapping one coin to another is a taxable event in every country I'm aware of.

Sorry, but I'm aware how it works in my country and the taxable event is only when you exchange into fiat, service or a physical object.

Example for Poland: http://lexplorers.pl/en/polish-taxation-rules-virtual-curren...

German law is even better, you don't pay any tax for selling digital currencies if you hold it for at least a year.

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

#319

Post by labrador »

PKop wrote: post #242
shawabawa3 wrote: post #216

Earlier quoted context omitted.

As someone that holds a lot of stable coins (USDC, not USDT) The same reason you would hold dollars in a bank account. My local currency (GBP) is weak atm and falling against the dollar. I want to be able to use crypto services (easy transfers, buying/selling crypto, borrow/lend on DeFI), but I don't want any more exposure to the currently volatile crypto markets, so I hold a lot of USDC Some of that USDC is being le…

It's surprising how many times the question you are answering gets asked and people still don't get it.

> My local currency (GBP) is weak atm and falling against the dollar

That's an edge case that isn't a concern for Americans who are most enthusiastic about crypto and most involved in the crypto revolution. This is pointed out often and the crypto enthusiasts don't get it. Crypto for most of us is YAGNI

YAGNI! Because you ain't gonna need it https://www.youtube.com/watch?v=fPJohxVLJu0

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

#320

Post by krzyk »

lottin wrote: post #292
krzyk wrote: post #284

Earlier quoted context omitted.

Why? You eventually have to pay it when you cash out (or buy service, goods with crypto). If you wait you loose tax returns for the amount you invested in crypto (with each year you have it halved). Basically this is the same as in case of stock market. You don't pay taxes until you sell stock. And here stock is whole crypto market.

I buy 100 USDC. I use these to buy some crypto-currency. 6 months later, I sell the crypto-currency for USDC, making a 10% profit. I sell the USDC for USD. Notice that I have made no profit from the sale of USDC, which is (supposedly) the only taxable event in this series of transactions. I bought 110 USDC worth $1 each, and sold 110 USDC worth $1 each. And I don't even have to sell the USDC for USD, I can buy stuff…

No no, you pay not the gain of transaction, you pay tax for the whole amount. And then deduct the amount of fiat you used to buy crypto.

So, you buy 100 USDC for $100 - you report that in your tax information (for use in following years tax deduction).

Then some time ago, you sell 110 USDC for $120, you pay tax for the amount $120 - $100 (unless the $100 was used year earlier, then you can use just $50 as a cost).

If you didn't report any costs (meaning buying crypto) you pay tax for the whole $120 amount.

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