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Tether's Troubles in November 2022

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Re: Tether's Troubles in November 2022

#61

Post by dangero »

dangero wrote: post #16

I have a theory of why Tether is able to dodge risk. If they are owned by Bitfinex can they not front-run the Bitfinex order book to guarantee their stops will hit their target? They know the bitfinex order depth for every asset so they can for example buy into bitcoin and then calculate exactly when they must get out. Its possible this could be built into the core layer of their exchange software. That’s how I would…

At any moment they can see the order book size in btc and the prices so if they buy btc with USDT they can safely hold the Bitcoin provided they are monitoring the order book. If a big sell order comes in or someone tries to cancel a buy order they can preempt it with a sell from their holdings to make sure they don’t end up in the red.

Bottom line if you can freely frontrun an order book you can make a lot of money. USDT provides the liquidity to do that.

Re: Tether's Troubles in November 2022

#62

Post by roenxi »

rhino369 wrote: post #52
raven105x wrote: post #33

Earlier quoted context omitted.

You're describing post-1971 USD. It's getting difficult to tell which currency is the bigger scam at this point.

It's not a scam if everyone knows how the system works. The Federal Reserve doesn't pretend like the dollar is backed by anything. The Federal Reserve also manipulates supply to try to keep prices stable. They've messed that up the last two years, but rather just continuing to print money they are reducing the supply on purpose. It's nothing like Tether.

Everyone knows how Tether works. I bought some after the de-peg before the most recent one anyway because I needed something worth about $1 USD to buy Monero. And I'd still be happy to point out that USDT is unbacked and extremely risky (ie, going to collapse eventually by design).

It is obvious that the people who own "wealth" in Tether will lose it sooner or later. If there are a large pool of people who believe Tether is 1:1 backed they:

1. Haven't read any news about Tether.

2. Haven't researched it at all.

3. Aren't a member of any social network like HN where Tether's flaws are trumpeted.

4. Are quite gullible.

EDIT 5. Haven't looked at a price chart of Tether showing it's regular de-pegs.

Such a person will fall for any scam, Crypto-related or otherwise. Regulated industries will still have people willing to take all their money since they aren't financially literate.

> The Federal Reserve also manipulates supply to try to keep prices stable.

Prices rise continuously, that isn't stable. The Fed tries to keep the rate that the US dollar loses value stable. The backers of Tether are making better guarantees than the Fed are - actual stability. They have less power to force people to go along with them though.

Re: Tether's Troubles in November 2022

#64

Post by andirk »

shuckles wrote: post #53
andirk wrote: post #51

Why do people use Tether scamcoin over Gemini stablecoin GUSD? It's supposedly backed 1:1 GUSD:USD and has US-regulated books. I get 5-8% interest on it and hasn't had an issue for its handful of years of being issued.

Do you have to prove your funds are not black money to buy "GUSD"?

No idea. I transferred a bunch of coins from Bittrex and Coinbase, sold some for USD for a nice profit, put that USD in to GUSD, and a month ago pulled out last year's interest of ~$1500 USD to buy some beautiful pendant lights, brass faucet, and a mediocre range hood for my new kitchen remodel.

Re: Tether's Troubles in November 2022

#65

Post by evdubs »

bibabaloo wrote: post #46

Can someone explain why the bank run on Tether hasn't already happened? We've seen with FTX that it only takes a little FUD for people to get scared and start withdrawing. It's not like there isn't more credible stablecoin alternatives, USDC looks a lot more credible.

A (partial) bank run on Tether already happened. From May 2022 - July 2022, Tether capitalization went from $83B to $66B ($17B withdrawn).

The recent bank run has so far been a lot smaller. From Nov 9th to today, the move has been from $69.75B to $67.25B ($2.5B withdrawn). Maybe if the FTX contagion extends, we'll see more redemptions.

https://coinmarketcap.com/currencies/tether/

Re: Tether's Troubles in November 2022

#66

Post by rhino369 »

JumpCrisscross wrote: post #21
kranke155 wrote: post #2

This will be the true extinction level event for this era of crypto. I now fully expect it to happen on this bear cycle. It will be interesting to watch - potentially the FTX investigation coming off the bankruptcy will set loose enough threads we will learn the truth.

> will be the true extinction level event for this era of crypto People keep saying this, but it runs counter to the history of gambling. As long as enthusiasts have money, the game will keep going.

I've said this like 5 times and I've been wrong 5 times. But eventually there won't be any more bagholders.

Re: Tether's Troubles in November 2022

#67

Post by zbentley »

andirk wrote: post #54
louwrentius wrote: post #8

I just hope that this is the beginning of the end for the whole crypto space. Good riddance. This fraud galore has no legal basis for existing.

All coins are scams? Wow that's quite a bold statement and clearly from someone who has researched all the top 500 projects in the space and clearly not some1 who is bitter they didnt get in at the beginning despite being there and not pulling the trigger.

This is such a tiresome common refrain, and a very telling one.

Critical? Then you must not have gotten rich/must not be money material!

This is quite literally the line used by "energy deregulation" MLM hucksters.

It's OK to admit that you're enthusiastic about something because you think it'll make you rich. Heck, it's even OK to promote it because you think that will help pump things in some small way (or a large way, depending on which sketchy Telegram chats you're pumping it in).

But don't BS others, or yourself, about your reasons for doing this.

The music's been fading out for a bit. The world changing innovations didn't happen, the grand plans were very nearly all vaporware, and the few that were even arguably real have come to naught.

It doesn't take any bitterness to come to an overwhelmingly negative opinion about this entire area and anyone even somewhat bullish on it.

Re: Tether's Troubles in November 2022

#68

Post by super256 »

grey-area wrote: post #29
JumpCrisscross wrote: post #21

Earlier quoted context omitted.

> will be the true extinction level event for this era of crypto People keep saying this, but it runs counter to the history of gambling. As long as enthusiasts have money, the game will keep going.

As long as there are enthusiasts. When the music stops, everyone is rushing for the exits at the same time. The music stopped sometime last year, now we’re in the end game.

I don't believe that. Traders do trade because price action is still there. The price itself is not as important as much as the movement!

LUNC (Luna Classic) is still having 1.2bn USD futures volume on OKX, although its value should be zero. Why is this happening? Because LUNC still hasmovements from 0.000184 USD to 0.00019 USD; that's around 4%.

Traders will use this price action, and by doing this they add their own weight to the price action. Simple intermittent reinforcement.

Re: Tether's Troubles in November 2022

#69

Post by shuckles »

andirk wrote: post #63
shuckles wrote: post #57

Earlier quoted context omitted.

Not only is that adjacent to, but itself, a wrong statement, what does it even have to do with anything?

Quoted post unavailable.

Inflation is a measure of purchasing power. I have all the dollars in my pocket and, depending on what I'm trying to buy like shipments of containers from Shanghai to Los Angeles, I could possibly buy more goods and services from last year.

I think your comments are below the level of quality the HN community demands.

Re: Tether's Troubles in November 2022

#70

Post by zen21 »

wmf wrote: post #55
bibabaloo wrote: post #46

Can someone explain why the bank run on Tether hasn't already happened? We've seen with FTX that it only takes a little FUD for people to get scared and start withdrawing. It's not like there isn't more credible stablecoin alternatives, USDC looks a lot more credible.

Destroying Tether would trigger a crash that benefits no one in crypto.

A casino going bankrupt means gambling addicts will be able to seek treatment for their illness.
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