Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Tether: The Story So Far

kalzumeus.com

Post reply on HN
Print view View original

91–100 of 241 posts

Re: Tether: The Story So Far

#91

Post by jcranmer »

lawn wrote: post #84
jcranmer wrote: post #81

Earlier quoted context omitted.

All Venezuela has to do is to make it illegal for anyone to sell you Bitcoin. Effectively, the current situation is rather close to that: the financial system is predicated on Know Your Customer and Anti-Money Laundering regulations that make moving large amounts of money for anonymous purposes dangerous for financial institutions. Given that cryptocurrency has struggled to provide any rationale for its existence oth…

And all the U.S. had to do is make drugs illegal, and it would disappear. (Or not.) > other than the anonymous money flows Are you saying that anonymous money is immoral and should be made illegal, and in the process dismissing all use cases that benefit from anonymity? And no, cryptocurrencies are perfectly legal in most of the world.

I'm pointing out that anonymous money flows are already effectively illegal, given the KYC/AML laws. At some point, any Funny Money system you create has to interact with the fiat system so that people can actually do stuff like pay their utility bills, and if Funny Money is triggering compliance alarm bells, and at that point, well, read the article.

Something else to point out is that just because a system is unsustainable doesn't mean it will collapse immediately.

Re: Tether: The Story So Far

#92

Post by api »

darawk wrote: post #15

Your daily reminder that you can short Tether if you want. All these people writing these articles, and the freely moving market price hovers right around 1:1. Funny how when people are asked to bet, despite the fact that there's almost no risk of loss for shorting it, their convictions disappear.

"Markets can remain irrational longer than you can remain solvent."

Also if Tether implodes the exchanges you're using to short are also likely to implode or exit-scam (since they'll know the gig is up), and there is no recourse.

Re: Tether: The Story So Far

#93

Post by [deleted] »

falcolas wrote: post #77
lawn wrote: post #70

> I have looked, quite a bit. I have not found a good use case yet I'm always surprised that intelligent and knowledgeable people claim this. You haven't even found a single use case? You don't think buying a VPN anonymously is a good use case? Or see the need for uncensorable donations? (Remember how the U.S. shut down Wikileak's PayPal donations when they exposed their war crimes?) Or that cryptocurrencies allow bu…

All of your use cases involve anonymity. Crypto currencies don’t provide anonymity. Sure it’s not directly tied to your name and address, but it’s quite possible to make that tie. Such cases are on the news fairly frequently.

[deleted]

Re: Tether: The Story So Far

#94

Post by stale2002 »

falcolas wrote: post #77
lawn wrote: post #70

> I have looked, quite a bit. I have not found a good use case yet I'm always surprised that intelligent and knowledgeable people claim this. You haven't even found a single use case? You don't think buying a VPN anonymously is a good use case? Or see the need for uncensorable donations? (Remember how the U.S. shut down Wikileak's PayPal donations when they exposed their war crimes?) Or that cryptocurrencies allow bu…

All of your use cases involve anonymity. Crypto currencies don’t provide anonymity. Sure it’s not directly tied to your name and address, but it’s quite possible to make that tie. Such cases are on the news fairly frequently.

No, they don't have to involve anonymity.

For example, lets take donating to WikiLeaks as an example. Anonymity is not needed for that, since they have never been charged with any crimes.

The only thing needed was a way to get around the banking cartel, that blocked payments to them, even though WikiLeaks was not charged with any crimes.

If it was 2011, being able to donate to WikiLeaks, was something that many people needed crypto for, regardless of anonymity.

Re: Tether: The Story So Far

#95

Post by wmf »

nullc wrote: post #79
Analemma_ wrote: post #42

Earlier quoted context omitted.

This is pretty revisionist. My own experience lurking in crypto communities (and reading the replies to @Bitfinixed), was to insist that everything was fine and furiously deny that Tether was a scam, and accuse me of being a dirty fiat shill for pointing out that Tether was a scam, right up until Tether starting admitting under oath in court that they were never backed by reserves, at which point the conversation swi…

> admitting under oath in court that they were never backed by reserves Huh. Did I miss something? If they were never backed by reserves how could $800 million of their funds ended up seized?

Never 100% backed. Clearly there was some money.

Re: Tether: The Story So Far

#96

Post by api »

Three things make the bubbly/scammy nature of current generation cryptocurrency very obvious to me:

(1) The fact that nearly all cryptocurrencies move in unison even though they differ widely in adoption and real-world use cases. Many totally useless cryptocurrencies move perfectly in unison with the supposedly useful ones.

(2) The fact that complete jokes that barely work like IOTA still have large market caps. (This post will get tons of IOTA shill replies like any other IOTA-related post on the Internet... they have an army of bots and shills.)

(3) Adoption has actually declined with numerous early adopters from small shops to companies like Stripe and Steam abandoning cryptocurrency payments. If this is a tech climbing the adoption curve adoption should be increasing.

There are a few real world use cases of course, but they are nowhere near sufficient to support the current collective market cap of cryptocurrencies in the current ecosystem... that is assuming a significant fraction of that market cap actually exists and the whole thing isn't completely insolvent.

I think the furious religious defense of (current generation) cryptocurrency you find in tech circles comes from the underlying economic ideology programmed into it (what I call pop-Austrianism) and the fact that lots of tech types are bag holders who are hoping to cash out before the whole thing implodes but may currently be underwater. Without those motives the whole thing is just transparently insane.

Re: Tether: The Story So Far

#97

Post by venantius »

I'm not sure the Hawala comparison is accurate; Hawala relies on essentially net neutral flows between nodes [exchanges] and trust-based credits and debits (not credit in the sense of literal credit, but credit in the strict ledger sense). This is in place of an actual transfer, which is what happens with crypto assets (unless Patrick is referring here to some specific decentralized exchange mechanism) - a transfer is made from one digital wallet (the original owners) to an exchange's, and from there presumably traded to someone else who is coming in with a fiat asset.

Re: Tether: The Story So Far

#98

Post by teknopurge »

lawn wrote: post #75
teknopurge wrote: post #11

Earlier quoted context omitted.

Fractional reserve banking has the same problem, yet provides a real, functional purpose for finance. Tether has a purpose - to be a savings account is not that purpose.

The minor difference is that you can withdraw your balance from banks, but you cannot redeem Tethers to what it's supposed to be backed by: U.S. dollars.

Everyone cannot actually withdraw their balance to fiat all at once.

Re: Tether: The Story So Far

#99

Post by teknopurge »

gamblor956 wrote: post #27
teknopurge wrote: post #11

Earlier quoted context omitted.

Fractional reserve banking has the same problem, yet provides a real, functional purpose for finance. Tether has a purpose - to be a savings account is not that purpose.

You can exchange your bank savings account for dollars (or Euro, or whatever). Hundreds of millions of people do this every day around the world without issue, because this is a solved problem.

Everyone cannot actually withdraw their balance to fiat all at once - this would be a bank run and wouldn't actually be allowed to occur.

Re: Tether: The Story So Far

#100

Post by lawn »

jcranmer wrote: post #91
lawn wrote: post #84

Earlier quoted context omitted.

And all the U.S. had to do is make drugs illegal, and it would disappear. (Or not.) > other than the anonymous money flows Are you saying that anonymous money is immoral and should be made illegal, and in the process dismissing all use cases that benefit from anonymity? And no, cryptocurrencies are perfectly legal in most of the world.

I'm pointing out that anonymous money flows are already effectively illegal, given the KYC/AML laws. At some point, any Funny Money system you create has to interact with the fiat system so that people can actually do stuff like pay their utility bills, and if Funny Money is triggering compliance alarm bells, and at that point, well, read the article. Something else to point out is that just because a system is unsus…

Oh alright. I don't see how this invalidates the use cases? The businesses that have payment processor problems aren't illegal, and can easily prove their revenue.

And I do agree that unsustainable systems don't collapse immediately. I've been waiting for Tether to collapse for years. But I don't think cryptocurrencies as a whole are unsustainable (the larger proper exchanges that don't use Tether as their "fiat option" should survive).

Post reply on HN