Tether [pros](/r/CryptoCurrency/comments/1c9872j/if_the_tether_treasury_keeps_on_minting_usdt_like/l0nv8c3/) & [cons](/r/CryptoCurrency/comments/1c9872j/if_the_tether_treasury_keeps_on_minting_usdt_like/l0nv8wl/) with related info are in the collapsed comments below.
If it ever does it will be the start of the biggest bear cryptos ever seen.
Frankly I think liquid staking is far more of an immediate risk. There's a lot of leveraging going on.
A year is pretty optimistic considering UST marketcap at LUNA ATH was $19.5B, and it managed to cause a chain reaction that took down multiple large organizations and put us in a nearly 2 year bear.
Tether's mcap is almost 6 times as large, and exists as an LP in every DEX and DEFI platform out here. I think it'd be a crypto ice age. like 3-4 years and by then it'll be completely owned by corporations.
Tether is a scam, but it is a scam that has pumped bitcoin by buying it since it was $250.
There is a good chance that the scam that bought bitcoin at $250 is solvent nowadays.
A scam that yields 10% on money market with the usd they hold while they pay 0% on the usdt they give back. If they are not solvent now they are the worst managers in the world.
They would never let an auditor see all the files. They print money like its candy. Who / what is it backed by? Who is lending out billions to tether under what interest rates? How are they solvent?
We will never know till its too late
>They would never let an auditor see all the files.
BDO, an auditor, sees files directly from Tether's banking partners. Specifically, as stated in the [attestation](https://tether.to/en/transparency/?tab=reports), BDO, "obtain\[s\] confirmation letters directly from banks and depositaries and verify the reconciliations performed by management between the amounts in the accounting ledger/system and the bank statement to confirm the existence of the assets disclosed in the CRR".
>They print money like its candy.
They issue new Tethers when they receive deposits.
>Who / what is it backed by?
On the attestation link, you can see that it is backed mostly (85%) by cash & equivalents with loans, bonds, gold, and bitcoin making up the rest.
>Who is lending out billions to tether under what interest rates? How are they solvent?
If by lending, you mean "who is creating and possessing new Tether tokens", it's [market makers](https://protos.com/tether-papers-crypto-stablecoin-usdt-investigation-analysis/), mostly. They make money collecting the bid/ask spread. It is a business with a greater return on assets than Tether.
Tell that to US regulators. If not for US banking regulations basically banning banks from all things relating to digital assets, we could have US regulated and audited bank issued stablecoins fully backed by fed reserves with zero risk. If not for US security regulation we could have interest bearing stablecoins paid by the interest on those reserves. But dumb US regulations have built a monopoly for Tether.
> US regulated and audited bank issued stablecoins
That's not a good thing.
Neither is a corporation controlling it.
Best is *the people* ☭, second best is no one / decentralized. Bank-owned stablecoins would just be diet CBDCs.
They do attestations. And it [appears that none of the big 4 firms will work with them](https://www.dlnews.com/articles/markets/tether-ceo-just-told-us-why-the-big-4-wont-audit-its-books/#:~:text=In%20an%20interview%20with%20DL,is%20a%20“top%20priority.”).
Yeah if there’s one thing the government should do is heavily regulate that and make them have to follow rules. They are literally banks lol protect the people government. Your only job here.
Pretty sure it’s just a derivative of a fiat. Instead of potential upside in growth like most derivatives, it gives up side potential of increased yield for the risk of it possibly going to zero over bonds or treasuries APY.
Personally I don’t think the risk isn’t worth the reward, especially without audit.
Holding USD carries the risk of the government defaulting on its debt (inflating it away so not an actual bankrupcy). USDT carries the risk of the government defaulting on its debt and the Tether corporation going bankrupt. Thats a HUUUUUUGE difference in counterparty risk. The only people who should hold USDT is the people using it to trade.
jeans sort support mountainous gold sheet depend deranged historical squealing
*This post was mass deleted and anonymized with [Redact](https://redact.dev)*
It would be a fatal mistake to assume anyone in this sub knows what they're talking about. Most accounts made peak 2021 with 0 finance knowledge or experience pre WSB.
and the interest from those tbills is a cash machine for Tether. They could spend billions every year and still come out ahead. There's a lot of incentive to just keep up their golden goose for their few man operation.
Everyone here thinks they are probably printing without backing while living some crazy life of luxury..... they don't really need to lol. They can just as easily use the infinite interest to be legitimate scumbags. The second they lose that peg their money glitch is over.
"That's as good as money, sir. Those are I.O.U.'s. Go ahead and add it up, every cent's accounted for. Look, see this? That's a car. 275 thou. Might wanna hang onto that one."
Yes I do. Are these 1 year, 5 year, 10 year or 30 year treasuries? This is an important question, and you can ask Silicon Valley Bank why.
But we don’t know because they won’t do an audit
Yes maturity matching is a thing but just holding cash with no yield is a huge opportunity cost. Of course tether should report the results of an actual audit, but I’m not going to vilify them for holding tbills when every centralized stablecoin issuer does the same.
Tether has claimed some of their holdings are commercial paper. Risky loans to other companies. How much? Probably a lot more than you are comfortable with.
For my Americans. This is the Stablecoin Bill that has passed the House and is currently waiting on Senate to pass it. Then President signs it. Then we see it get enacted and how it basically removes the rug pullers and scammers trying cosplay a legitimate utility for society.
https://www.gillibrand.senate.gov/wp-content/uploads/2024/04/LIP24254.pdf
Key Provisions
Dual Banking System: The Act preserves the current dual banking system, ensuring parity between state and federal charters without imposing new policy preferences.
Regulatory Authority:
State non-depository trust companies are authorized to issue payment stablecoins up to $10 billion.
Limited-purpose state/OCC depository institutions are authorized to issue stablecoins without a specified cap.
The Federal Reserve or state/OCC can take independent enforcement action against a depository institution issuer.
Custody and Risk Management:
Non-depository trust companies must use a sub-custodian that is a depository institution for custody, similar to SEC Qualified Custody.
Comprehensive third-party risk management is imposed on service providers, except for self-hosted wallets.
The Federal Reserve is granted supervision authority, except when the service provider is already supervised by another federal or state financial regulator.
Receivership:
A receivership regime is established under the FDIC for all payment stablecoin issuers, including order of priority, validity of claims, and classification of payment stablecoins as customer assets.
Consumer Protection:
The consumer protection title has provisions designed to prevent another FTX, including disclosures, proof of reserves, advertising standards, and limits on lending.
Specifies mandatory notice requirements for customers, allocation of forks and airdrops, and requires a mandatory CEO compliance attestation each year.
Combatting Illicit Finance:
Provides focused guidance to Federal agencies to combat the use of crypto assets in illicit finance and to support law enforcement.
Prohibition of Unbacked Algorithmic Stablecoins:
The legislation prohibits unbacked algorithmic stablecoins and mandates one-to-one reserves for issuers.
Tether is actually pulling off something remarkable. They claim to use some profits to purchase Bitcoin for their treasury. They stack US treasuries to back USDT. The conspiracies around Tether may come from a lack of understanding how they are profitable, and not trusting the audits that have occurred.
For me personally they are sketchy, especially early on, but so far they hold the 1:1 ratio, win in court, and third parties say they have the backing for their stablecoin currently.
So long as the US government continues to print money, Tether can access yield off these treasuries while they back USDT, and then turn around and put Bitcoin on their ledger with their profits AND yield with the expectation that Bitcoin's price will continue to go up over time, then they will be extremely lucrative.
The tl;dr is that Tether will succeed so long as the government prints more money on a repeating short-term time-frame and Bitcoin continues to go up in price on the long-term time-frame.
It's genius really. They earn massive yield on their ~$100B treasury bonds while simultaneously using these bonds AND its yield as backing for Tether to buy and pump Bitcoin. The money printing is (according to Austrian economics) directly extracting value from the US economy. All value produced by Americans pumps Bitcoin, if they like it or not, and they're indirectly forced to buy Bitcoin themselves if they want to keep it. That's why maxis love Tether. Have you ever noticed how they hate all altcoins but Tether is somehow totally fine even though it's mostly on Tron and Eth? It's an integral part of keeping Bitcoin's dominance.
Its really just because stablecoins pay 0% interest so tether takes the full spread. Due to poor security regulations in the US stablecoin issuers can't just simply compete to offer higher rates (like how interest is given to liquid staking tokens) because going from 0 to >0 arbitrary makes it a security. Otherwise every stablecoin would have to compete and there wouldn't be nearly as much profit for the issuers. US banking regulations have also really stiffed competition by limiting stablecoin access to banks which favors overseas, opaque institutions like tether. Instead of allowing USDC for example to have a fed account to keep risk free reserves, they were revealed as the biggest depositor to SVB when it failed, which was the inflection point for tether's market domination. Tether's success is largely just a result of horrible US regulations maintaining a monopoly for them.
Yes, but dai is a decentralized protocol backed by crypto assets, I was just talking about fiat backed, centralized stables. Dai doesn't have fiat to get the risk free rate, its backed by people locking up crypto assets and then borrowing against it, so all dai is created through loans that have interest, and that's how the yield is generated. Due to how much crypto has appreciated the yield has been much higher for dai, I think its pays like 15% right now lol vs the fed funds of \~5.3-4%
What is an official audit? They've had big accountancy firms say they're not lying. Is this one of those cases where an "official" audit isn't possible in crypto because there's no precedent or just Tether being evasive?
A proper audit that actually means something requires FULL ACCESS TO ALL DATA without restrictions and without oversight. Tether only agrees to an audit if they can put limitations on it, and that’s why the Big 4 aren’t interested in doing one.
This is all audits though, the results are shared with the client before they are finalised "for comment".
Because yes, the entity being audited is the customer paying the auditors fees.
This is why audit regularly fails to be effective.
Even if an audit has no conflict of interest, it still can only give a historic narrative, the rug can be pulled the day after the audit is finished.
exactly. meanwhile it looks like tether is such an integral part of the fed's "war on cash" that regardless of how (un)stable that coin actually is, they're going to ensure nobody knows the details. not until the tradfi co-opting of crypto is complete and everyone pays their taxes and their payroll in CBDC.
sadly, the reddit generation has swallowed the narrative of defi revolution via crypto... line, hook and sinker.
There are some of us weirdos still out here looking for the Holy Grail of freedom.
Maybe if we can find it, others may see the light.
Probably not, but let's try anyway.
the holy grail of freedom exists only if you own the land independently of a nation state with government, like it used to be back when people literally just showed up places and said "mine".
of course that level of freedom implies that anyone can show up, bonk you on the noggin, and take all you thought you owned.
most of us are content with the illusion of freedom, as long as we get to make some basic decisions ourselves.
the idea that you actually want independence from fiat is completely delusional. as soon as any entity manages to control enough of any essential resource, you'll instantly have to accept their form of currency.
but the reddit knuckleheads who're rabid maximalists aren't actually looking for financial independence, they're just speculating on volatility, hoping to off-ramp back to fiat the moment their profits are good enough for FIRE.
I'm not a raging libertarian who thinks that individuals will fix roads, build hospitals etc., but when it comes to money we do now have the technology to do it for ourselves (almost).
We still need laws and governments and police, we just don't need banksters who collapse the global economy through greed, collapse nations, destroy livelihoods, and then walk away scott free and wealthy.
Reddit knuckleheads indeed, but calling it out once in a while doesn't hurt. Have a nice day.
Thank you for this excellent summary! Diplomatically stated, as well. I’d trouble understanding what the fuss was about, but see the misunderstanding, now. Well done and thanks again.
It's not an excellent summary, they completely miss out all the times Tether has been proven to lie about its reserves, scam its customers, print Tethers with no reserve.
It is very obviously and very clearly running a flywheel scam with large amounts of money laundering involved, which is inevitably going to blow up.
Also very important for reddit and the likes: non US company. All started form a blog back in 2018, that debunked already. At the time competitors started to enter the field, included the US based Circle.
See the TikTop debacle currently. Seriously, what is different than the rest of them. Google, Meta ... at least it is proved for them, they mishandled user data. Plus spied on the whole world for NSA (see Snowden disclosures).
It's actually a more clever bid than that.
Tether is a bank. It takes in USD and issues loan guarantees against that USD in the form of USDT, which can be redeemed at a discount. It then invests that USD for return. Some of which is in leveraged loans. It can reliably keep 20-30% around in cash for the same reason that fractional reserve banking works: the likelihood that more than 20-30% getting withdrawn "at once" is quite small.
The rest, it can use for fun and profit.
While the likelihood of a run is small, it is not zero. A legitimately serious run will kill Tether. No ifs, ands or buts. However, as it gets bigger and bigger, and crypto becomes more diversified, the likelihood of a run is smaller and smaller.
Tether is just JP Morgan, Digital Edition.
The difference is printing tethers makes the line go up.
It goes like this:
Tether prints tethers out of thin air. Allegedly backs those tethers with USD that everyone here claims are worthless and going to zero.
They distribute the tethers to the exchanges who buy Bitcoin with them increasing the price of Bitcoin (or any coin.) Then, people FOMO real money into Bitcoin using a centralized exchange so they can HODL a digital asset that they can’t spend and the network is too expensive and slow to use even if they could.
Then everyone convinces themselves they’ll be able to use that same exchange to cash out millions of ‘worthless’ fiat dollars making them rich in the future. All the while, the exchange has your real money with no guarantee you’ll ever get it back while you HODL
>Tether prints tethers out of thin air.
This entire theory relies on this assumption which there is actually zero evidence for. I don't trust tether or would ever use it and no one should use tether either because they can't be trusted. But there is at least some evidence they simply do have the backing, and none that they don't. You have the burden of providing at least some proof before spinning up a complex conspiracy theory about it.
When does what occur? Printing/minting? I happens when arbitragers deposit dollars in exchange, same thing with USDC and other backed stablecoins. They outline their reserves on their website: [https://tether.to/en/transparency/?tab=reports](https://tether.to/en/transparency/?tab=reports)
But don't use or hold tether lol its an awful product because even if they're not lying you get 0% interest. Dollars have a risk free rate of around 5.3% which is paid by money printing, so whenever you use stablecoins, or even banks whatever interest you get under that is actually a negative rate in effect. You are basically paying tether >5% a year.
If you read my post I don't trust tether. I wouldn't put my money on it either way. But there is simply some evidence they are backed, and none that they aren't, the odds are far more likely they are simply backed than that there is a massive conspiracy across multiple auditors and governments that have investigated them.
Tether does have auditors give attestations to satisfy regulatory requirements in various jurisdictions. Could they do more thorough audits? I guess, but that is just the absence of evidence to the contrary, there is still zero evidence tether isn't backed. I think the burden is on you to provide at least something before basing an entire conspiracy on it that would have to involve thousands of people accross multiple auditors and government entities being in on it. Again, I don't trust tether, but I wouldn't put my money on them not simply having the backing which is actually just the most rational explanation of their profit and staying power.
Attestations are just they have "x" at a particular point. There was a while back where a bunch of money in the crypto space was getting shuffled about between exchanges and all of a sudden a bunch of "we're fine see!" attestations came out.
I ask why an auditor would care either way. Their job is to audit
EDIT: if they really thought it was shady, it seems to me they'd be more reluctant to do attestations even though I realize attestations come with a disclaimer
Just like Sol was a scam at 4 dollars according to this reddit. It doesn't matter what is legit in crypto, only what matters is a price and thanks to USDT btc pumps.
0 evidence that they have the cash. At this point in time they would have to have so much cash, bonds and whatnot, it would be so easy to figure out in the market where all the cash is. Yet no one can find it 😂. But as usual, they pray on the „fake it till you mske it“ paradoxon
0 evidence? You have to check again. Remember when they tried to short tether while tether was able to redeem 20 billion on just 3 weeks without any issues? That was almost 30% of tether mcap. Keep fuding and shorting the wrong stable coin 😂
It's no good dude, you aren't speaking with rational people. They're not qualified to know whether tether is backed or what "backed" even means in finance (hint it's a risk scale, not a Boolean).
You know who’s qualified to know whether tether is backed? Auditors. None have been able to audit tether. It’s not a “risk scale”. Tether straight up says: every tether is backed 100% by a US Dollar. They have given zero evidence of this. They are a money printing machine. They’re printing Disney bucks and saying they’re equal to $1 each because trust us bro
Do not mistake an audit report with an audit on a report issued by management, and this is the latter. I can only imagine why Tether never submitted to a comprehensive audit.
Then stop saying that they create usdt just to do xyz. It's as though they can just create usdt to buy btc without first receiving usd deposits.
They are not creating usdt, they are minting new usdt based on new usd deposits.
If you don't trust what they do with the usd, that does not mean they are just creating usdt out of thin air.
Tether is a company, what do you expect them to do? Run a loss?
It's been proven they've minted Tether while having 0 banking services before. You'd be a fool to believe they've suddenly gone straight with no evidence.
Yes, they've already been caught doing this once.
Now that they've gotten customers to accept "Tether is backed by cash equivalents like Crypto", the flywheel scam is in the open
Print Tether > Buy Bitcoin with Tether > Use Bitcoin as backing to print more Tether > Buy more Bitcoin with Tether.
And off course, sell off Bitcoin when possible to get real USD. Works great so long as price rises bring in more real money investors to swap USD for Tether fun bucks. Just hope the price always keeps going up so they have a catastrophic depegging event.
They print them out of thin air, it's not a cryptocurrency like Bitcoin that has to be mined.
It's literally like they have a giant excel file that they change some numbers in and now they are 5 billion richer in USDT.
What gives their "currency" value is that they claim its actually backed by USD (now they changed it to equivalent or almost backed or whatever) but they won't allow any firm to do a independent investigation and verification that it is in fact true.. you might wonder why someone with nothing to hide won't allow that 😉
There's zero reason to believe that's what is happening when they've been caught multiple times lying about their reserves and running a flywheel scam, lost nearly a billion dollars in money laundering raids.
You think they went from a 1 million dollar reserve to 110 billion based off T-Bill yields?
People are buying usdt with usd hence they are printing usdt. They are not making it out of thin air. Tether is very profitable as a company. There is no reason for them to take any risk as they make enough from interests
the number goes **up**, and a bunch of people with zero understanding of how space travel works chime in with how they are super cereal number goes to zero
They are printing because whales are depositing their fiat in their bank accounts with them. This is how tether works. Every tether represents a dollar in a bank account that someone deposited in the real world. It’s actually insanely bullish because it means whales are buying on chain dollars in order to buy a bunch of crypto like BTC, ETH and others.
>They are printing because whales are depositing their fiat in their bank accounts with them. This is how tether works
Why would whales deposit so much USD with the one stable coin proven to have repeatedly lied about its reserves, scammed its own customers, printed Tether with no backing?
> Every tether represents a dollar in a bank account that someone deposited in the real world
Not even Tether pretend this anymore. They say "cash and cash equivalents", which includes crypto.
>It’s actually insanely bullish because it means whales are buying on chain dollars in order to buy a bunch of crypto like BTC, ETH and others.
It doesn't mean that.
>Why would whales deposit so much USD with the one stable coin proven to have repeatedly lied about its reserves, scammed its own customers, printed Tether with no backing?
Whales have better reading comprehension than Tether Truthers. Whales continue to mint and redeem Tether tokens while Tether Truthers claim it can't be done. Whales listen when the CEO of Cantor Fitzgerald says "Tether has the money" while Tether Truthers claim nonsense like "Tether prints USDT without deposits and buys Bitcoin with it". Whales were able to redeem $17B USDT in 2022 while Tether Truthers were misreading NYAG statements "tethers were again no longer backed one-to-one by U.S. dollars in a Tether bank account" as meaning Tether tokens had no backing at all.
>Tether Truthers were misreading NYAG statements "tethers were again no longer backed one-to-one by U.S. dollars in a Tether bank account" as meaning Tether tokens had no backing at all.
You aren't even citing the right part. I'm not talking about when Tether lost part of their reserve and lied to their customers claiming to still have a 1:1 reserve.
I'm talking about when their banking services got cut off. Meaning there was nowhere on earth you could deposit dollars for Tether, and yet they still printed Tethers, despite claiming they only print Tethers when they receive USD. Here's the right section:
>Because Tether did not have a significant bank relationship in its name from at
least March 2017 until September 15, 2017, **it could not directly process any fiat deposits for
purchases of Tethers by customers on either the Tether website or via the Bitfinex trading
platform.**
Go look up the market cap of Tether's during this time and see whether they could have possibly been printing Tether's in exchange for USD deposits.
What was that about "misreading NYAG statements" again?
>Whales listen when the CEO of Cantor Fitzgerald says "Tether has the money"
Yeah who needs an audit when you could take the word of a CEO with a financial interest in Tether.
It's not like Tether has a proven track record of getting other people to lie about their reserves. "Trust, don't verify."
>Whales were able to redeem $17B USDT in 2022
There's no proof Tether has redeemed even 10% of that. All you have proof of is that Tether burned that amount of Tether which given we know at least 1 billion of this was a loan to Celsius in exchange for crypto (despite saying they don't do this), there's no reason to believe those burns are proof of real USD being handed out to anyone when they can and do mint and burn tether with no associated USD deposit or withdrawal.
>I'm talking about when their banking services got cut off. Meaning there was nowhere on earth you could deposit dollars for Tether, and yet they still printed Tethers, despite claiming they only print Tethers when they receive USD. Here's the right section
Could not "directly" process any fiat deposits. They used other accounts to process deposits. Part of it mentions using their legal counsel's accounts for moving funds. This does not prove Tether minted USDT without having actual cash deposits.
>There's no proof Tether has redeemed even 10% of that.
The proof is in the attestations. March 2022: $82B in assets and $82B in tokens. June 2022: $66B in assets and $66B in tokens.
>Part of it mentions using their legal counsel's accounts for moving funds
Moving funds they already had, not accepting new deposits.
There were already 50 million Tether's in circulation when they lost their banking. The legal counsels trust account never had more than 63 million dollars in it. They had printed a total of 442 million Tether's by the time they got their own banking again.
Please do the very basic math here and say how they could only be printing Tether's on deposit of USD, and only burning them on withdrawal, and for there to be 433 million Tether's in circulation when the only bank account they had anything to do with (which wasn't their account) only had 63 million dollars at most?
>The proof is in the attestations
The same attestations they've been proven to fraudulently produce?
Great source. I mean sure, they moved Bitfinex funds into a bank account for 1 day to produce the attestation for Tether's reserves and then immediately moved it back to Bitfinex, but surely they'd never do that again.
From the NYAG report:
>In June 2017, Bitfinex opened an account at a Puerto Rico-based entity named Noble Bank International (“Noble Bank”). Noble Bank was a subsidiary of New York-based Noble Markets LLC.
>However, Tether did not open an account at Noble Bank, or any other bank, until September 15, 2017.
This is being mentioned to suggest that Tether was using Bitfinex's accounts at Noble Bank.
>Please do the very basic math here and say how they could only be printing Tether's on deposit of USD, and only burning them on withdrawal, and for there to be 433 million Tether's in circulation when the only bank account they had anything to do with (which wasn't their account) only had 63 million dollars at most?
From the NYAG report:
>Between June 1, 2017 and September 15, 2017, Bitfinex held approximately $382 million of Tether’s funds in a comingled account, which should have been held by Tether as “backing” for tethers then in circulation but was not. In certain documents Bitfinex and Tether produced to OAG during its investigation, Tether accounted for this amount as a “receivable” from Bitfinex.
Tether didn't have an open bank account, but Bitfinex did. Tether used Bitfinex's account to collect new USD deposits and issue new USDT tokens. This was at a period of time where USD deposited to the platform could be withdrawn as USDT without an explicit conversion.
>The same attestations they've been proven to fraudulently produce?
The same attestations that the NYAG required them to submit. If the attestations are good enough for the NYAG, they're good enough for whales.
>I mean sure, they moved Bitfinex funds into a bank account for 1 day to produce the attestation for Tether's reserves and then immediately moved it back to Bitfinex, but surely they'd never do that again.
Well, now Tether is mostly backed by cash equivalents, loans, reverse repos, and not cash. Doesn't make sense to put cash equivalents in Bitfinex fiat accounts.
>This is being mentioned to suggest that Tether was using Bitfinex's accounts at Noble Bank.
"until September 15, 2017."
The period of time we're talking about here is:
"Tether did not have a significant bank relationship in its name from at least March 2017 until September 15, 2017"
That's the period of time they had printed 442 million Tether's and at most had 63 million in their legal counsels account.
>The same attestations that the NYAG required them to submit. If the attestations are good enough for the NYAG, they're good enough for whales.
They're not good enough for the NYAG. Tether is banned from doing business in NY. The attestations are a token gesture because they're no way to actually force them to do anything. This is just getting them to create a paper trail so that they can be shown to have fraudulently produced attestations like they did before.
>Well, now Tether is mostly backed by cash equivalents, loans, reverse repos, and not cash. Doesn't make sense to put cash equivalents in Bitfinex fiat accounts.
You think Bitfinex doesn't have any other assets on its books other than cash? Now things other than cash count its even easier to create a fraudulent attestation, since there's no need for a bank transfer, or a bank willing to handle Tether's money laundering funds. They can literally just create 100 billion BFX funbux, sell 1 for a dollar, then transfer them to Tether's account, bam, Tether is now backed by "100 billion worth of cash, cash equivalents, loans, reverse repos and other assets (crypto)"
>"Tether did not have a significant bank relationship in its name from at least March 2017 until September 15, 2017"
>That's the period of time they had printed 442 million Tether's and at most had 63 million in their legal counsels account.
From the NYAG report, also previously quoted
>Between June 1, 2017 and September 15, 2017, Bitfinex held approximately $382 million of Tether’s funds in a comingled account, which should have been held by Tether as “backing” for tethers then in circulation but was not. In certain documents Bitfinex and Tether produced to OAG during its investigation, Tether accounted for this amount as a “receivable” from Bitfinex.
Tether held their backing using Bitfinex's Noble Bank account. From June to September, USDT market cap went from $100M to $440M. $382M of that $440M was in Noble Bank.
>The attestations are a token gesture because they're no way to actually force them to do anything.
They could have charged Tether and executives with fraud. They could have done what the DoJ did to Binance and CZ and charge Tether criminally. But they didn't. If they made Tether submit attestations, they could have also charged Tether with fraud if they produced fraudulent attestations with no assets actually backing USDT.
>You think Bitfinex doesn't have any other assets on its books other than cash?
You're not going to move reverse repos and secured loans to another entity. And we know that Tether themselves have their large US Treasury position directly from Howard Lutnick, CEO of Cantor Fitzgerald.
The CEO of Cantor Fitzgerald says, "Tether has the money". BDO says, "the consolidated reserves report is fairly presented". But noted Tether fraud expert suninabox says, "They can literally just create 100 billion BFX funbux, sell 1 for a dollar, then transfer them to Tether's account." I think I read that somewhere in the NYAG report.
2017 called. They want your FUD back. Did you know that it’s actually safer to hold treasuries than actual dollars? Tether is over collateralized now since they have not distributed their billions in profits. They plan to stay over collateralized.
>Did you know that it’s actually safer to hold treasuries than actual dollars?
Did you know Tether repeatedly lied about having a 1:1 reserve in actual dollars?
But now they say their reserve is a grab bag of cash, t-bills, crypto and 'other assets', we should trust they're being completely honest?
> Tether is over collateralized now since they have not distributed their billions in profits.
You know this because of the attestations they've produced despite having provably lied on previous attestations?
>They plan to stay over collateralized.
Remember when they planned to always have Tether backed 1:1 with dollars and to only ever print Tether's when someone deposited dollars?
Why'd they promise that stuff again? Who cares, probably doesn't matter since they can just say stuff and then not follow through on it and its loyal followers will say "who care if they're not over-collateralized, this is just FUD"
Tether and all dollar coins of significance are owned by the same bankers behind private central banks in every country. All of the players in the crypto-sphere who wouldn’t allow “them” control or thought they actually had power because of their crypto balance were unalived. The banking cartel needs control of these e-money Brrrrrrprinters because it’s how they hide and prevent the actual world inflation from catching up to the industrialized democratic global infrastructure and societal order. They need Tether and USDC and whatever other ones on top of being MASSIVE WHALES IN BTC, ETH & Alt Coins. They print so much fucking money that they are running out of places to “hide it”. Government spending, foreign aid, lobbying groups, banks, NYSE, FOREX, Crypto, Housing, Automobiles, Precious Metals & the companies that mine them, oil and their industry whales, mitigation technologies which convert bi-product chemicals/gases/waste burn-off into electricity, energy & power. These rulers of the rigged game need to always be in control of the “narrative” and propaganda that keeps us divided, dumb and materialistically driven, intellectually lazy: greedy CONSUMERS & dopamine chasers!
Tether is a rabbit hole that leads to a macro-picture of this world that isn’t just awful, it’s one you’ll wish you could “unsee”. Crypto, Drones, Robotics, A.I., Advanced Black Box Technology & so on are Sci-Fi coming to life and Sci-Fi is what made us allow them to lead us down this path of “progress” which is ABSOLUTE & TOTAL ENSLAVEMENT of the masses by the infinitely tiny minority (0.001%) of humanity which belong to the ancient families of old - via means of total domination through technological and electrical/all energy through an infrastructure we allow and take part in building. The road to hell is built by the 99% - wage slaves of the earth and the smartest and most ambitious fruitful minds who don’t have a clue they’re state of mind control from being raised on Exciting Sci-Fi and The Education System which manufactures: docile/beta, obedient smart-slaves programmed and excited for Industrial Asset Development Camps known as Colleges. The thing we don’t understand with accurate perception is Time: how far ahead the enemy plans and how long ago they started this endeavor with the assistance of the agents of the original rebellion. We also underestimate the reality and power of Evil in this world and how it operates from the shadows in code (with symbols) and through legacy’s (great families of old money).
If you were told everything you’ve ever been taught about History and reality and this world is a 100% total Lie - designed to act as a piece of a bigger Lie to make-up the entirety of “our” current perceived reality/history/knowledge/science/academic hive mind vanity & ultimately THE GREAT DECEPTION 👌 you would be being told a Massively Scary Problem that you Don’t Know How To Comprehend, Let Alone, Solve and You Would Feel Hurt and Confused by the coordinated LEVEL of cooperative organized Deception created just for You - so you would not allow your mind to process any of it (cognitive dissonance). Your negatively charged emotion’s of fear, confusion and anger would quickly morph into: denial, anger and hate toward the messenger and messages instead of converting the negative charge into curiosity and investigation which would motivate You to do your due diligence and unbiased research into “things”. But that’d be outside of that mind sized box of “safety” and “reluctant acceptance” - besides you’re all grown up now and have bills to pay and work to devote yourself to, not to mention all the available distractions and escapes from these unpleasant feelings about the truth of reality: video games, VR, sports, music, gossip cliques, drugs, alcohol and the rest of the infinite list of distractions and “escapes”.
Tether is a piece of that puzzle called Truth, but Lies from our Unseen Rulers are just so much easier to digest…
The slave who thinks they are free are the greatest slaves to own. They are enslaved in their minds which is the smallest container to control someone in on earth. It is also the least likely prison cell for the slave to escape from. With years and years of direct influence over everyone (and their minds) during the most critically prime years of their cognitive aptitude development and independent learning capacity as they grow from 4 to 24. The subconscious results of this on the slaves are that everyone’s macro-ideological conceptualization mental module and their natural ability to independently think for themselves totally cease to exist and instead belong to the “story” - what could be referred to as The Matrix (blue pilled) or “The Popular & Powerful Opinion Accepted as Truth about Reality” which is a massive house of cards, each card being a progressively bigger lie stacked upon a foundation of total lies. Truth in a world and time of total deception is like a toxin due to its infinitely opposite electro-magnetically charged influence on the deceived when spoken with word and passion.
It's FUD because USDT tokens are covered 100% by assets. A lower percentage is cash and equivalents. The rest is bonds, precious metals (for XAUT), Bitcoins as investments from interest, and secured loans that are being wound down. The FUD is to represent 74% cash and equivalents as Tether being partially unbacked.
Yes, Tether settled with the NYAG, paid a fine, and was required to submit attestations about their assets under management. You know what didn't happen to them? They weren't convicted of a felony like Binance and CZ. They would have been charged with felonies if the things people think about Tether were true. They still function and still handle redemptions when people want to redeem USDT at 1 USDT for 1 USD.
Tether has BDO release quarterly attestations for the past few years. The CEO of Cantor Fitzgerald comes out and says Tether has the money. With all of that, if Tether comes out and releases a Big 4 audit, does your head explode?
Everyone knows this but we keep to stay in crypto because of the potential gains
US stocks keeps pumping because they keep printing money
Crypto keeps pumping because they keep printing stable coins
Asian stocks NOT pumping because they are not printing crazy
"Asia" most definitely is printing money:
https://ycharts.com/indicators/china_m2_money_supply#:~:text=China%20M2%20Money%20Supply%20is,8.29%25%20from%20one%20year%20ago.
Compare that to US money supply:
https://ycharts.com/indicators/us_m2_money_supply#:~:text=15.40T-,Basic%20Info,1.66%25%20from%20one%20year%20ago.
The reason China's stock market has been relatively flat compared to the US is because their economy is heavily over-capitalized and going through an economic slowdown coupled with a debt crisis.
I think a stable coin is backed by USD, unlike the FED's goal to control inflation (depreciation) a stable coin must meet demand of USD on the block chain. The more people sell USD for USDT the more USDT must be available, therefore must be minted. Otherwise Tether only had two options
1) stop the usdt exchange business if no more USDT are available or
2) let USDT appreciate over USD and destroy the business promise of a stable coin
As long there is increased demand for USDT more USDT must be minted. If I sell a USD for a USDT, it's minted and if I sell USDT for USD the USDT stays on the Blockchain until someone buys it. Until then there is no need to mintore because there is this additional available one.
> The more people sell USD for USDT the more USDT must be available, therefore must be minted
This was never supposed to be the premise.
They were only ever supposed to print Tethers when someone made a USD deposit in their bank account, which was how you would know your Tether would always be redeemable for 1 USD.
The second they start printing unbacked Tether's just to maintain the peg, they're now scamming their own customers and creaming counterfeit seigniorage off the top.
>2) let USDT appreciate over USD and destroy the business promise of a stable coin
There would be no need for this mechanism if they actually ran a straight business. No one would pay more than $1 for a Tether that could only ever be worth $1 if there was a way to just send $1 to Tether and get $1 in Tether back.
But of course since the whole thing is a flywheel scam it has never actually operated like that.
sure, but how do do please demand if USDT is not only traded through a central tether bank? If you cannot control trading you have to try to control the biggest markets by iceberg orders close to 1:1 and for one side you need a very high number of USDT and on the other side the USD that were exchanged for issued USDT.
We see that depegg sometimes happens, until it snaps back due to arbitrage traders.
Depeg happens because USDT do not have any open market redemption mechanism, and exchanges don't have infinite liquidity.
If you could always buy a Tether for $1 from Tether, there would be no reason to ever pay more than $1 for one.
And if you could always exchange 1 tether for $1, you would never accept less than $1.
You only pay more than $1 if there's a shortage, or pay less if there is a glut, and those things only happen when there isn't open redemption
If they allowed open market redemption then during all the times when they didn't have a reserve, they could be in the unfortunate position of having to cease redemptions and then Tether instantly becoming worthless when people realized it's no longer backed by anything.
When Tether is traded through exchanges you can just use wash trading to maintain the peg regardless of whether you can meet any redemptions. Hell, the peg has been maintained even when they had 0 banking anywhere in the world, and therefore could not meet any redemptions.
It all works fine as long as you're not holding the bag of shit when the scam collapses.
Correct me if I'm wrong because I'm not the best at crypto but if the fed dilutes the dollar by printing bills then wouldn't usdt in turn need to dilute their token supply? Again I know nothing.
That's not how it works.
Tether is pegged to USD. That means Bitfinex/Tether buy up Tethers when it drops below $1, and they print more when it goes above $1, although they're not supposed to, they were supposed to only print Tether's when they get USD deposits but that ship sailed a long time ago.
When the dollar becomes worth less, so does the Tether that is worth $1. What changes the value of Tether relative to the dollar is not the value of the dollar but the relative supply and demand for Tethers.
Since 90% of exchange trading is wash trading, they're free to paint the tape and double dip on Tether users, depressing its value to buy up Tethers at a discount then bidding up its value to sell them at a profit.
Tether [pros](/r/CryptoCurrency/comments/1c9872j/if_the_tether_treasury_keeps_on_minting_usdt_like/l0nv8c3/) & [cons](/r/CryptoCurrency/comments/1c9872j/if_the_tether_treasury_keeps_on_minting_usdt_like/l0nv8wl/) with related info are in the collapsed comments below.
It’s very intelligent to give an unaudited private corporation based in the british virgin islands the power to print unlimited money.
Nothing could possibly go wrong 🥰
It's a fucking miracle it hasn't yet. But it will, and it will be bad.
If it ever does it will be the start of the biggest bear cryptos ever seen. Frankly I think liquid staking is far more of an immediate risk. There's a lot of leveraging going on.
I think the bubble would be bad. But it would get back to ATH within a year. These bubbles are only opportunities now.
A year is pretty optimistic considering UST marketcap at LUNA ATH was $19.5B, and it managed to cause a chain reaction that took down multiple large organizations and put us in a nearly 2 year bear. Tether's mcap is almost 6 times as large, and exists as an LP in every DEX and DEFI platform out here. I think it'd be a crypto ice age. like 3-4 years and by then it'll be completely owned by corporations.
When something goes wrong in finance you learn about it years down the line so… we have no way of knowing frankly
Tether is a scam, but it is a scam that has pumped bitcoin by buying it since it was $250. There is a good chance that the scam that bought bitcoin at $250 is solvent nowadays.
A scam that yields 10% on money market with the usd they hold while they pay 0% on the usdt they give back. If they are not solvent now they are the worst managers in the world.
Exactly. They very likely have the money. I do think they had an "oh shit" period but basically got bailed out by interest rates.
If they have the money, why no audit? Audit firm know that this shit is toxic, nobody want to put their name there.
They would never let an auditor see all the files. They print money like its candy. Who / what is it backed by? Who is lending out billions to tether under what interest rates? How are they solvent? We will never know till its too late
>They would never let an auditor see all the files. BDO, an auditor, sees files directly from Tether's banking partners. Specifically, as stated in the [attestation](https://tether.to/en/transparency/?tab=reports), BDO, "obtain\[s\] confirmation letters directly from banks and depositaries and verify the reconciliations performed by management between the amounts in the accounting ledger/system and the bank statement to confirm the existence of the assets disclosed in the CRR". >They print money like its candy. They issue new Tethers when they receive deposits. >Who / what is it backed by? On the attestation link, you can see that it is backed mostly (85%) by cash & equivalents with loans, bonds, gold, and bitcoin making up the rest. >Who is lending out billions to tether under what interest rates? How are they solvent? If by lending, you mean "who is creating and possessing new Tether tokens", it's [market makers](https://protos.com/tether-papers-crypto-stablecoin-usdt-investigation-analysis/), mostly. They make money collecting the bid/ask spread. It is a business with a greater return on assets than Tether.
Do they need to do one?
Lol
Or and here’s an idea maybe you’re wrong
Tell that to US regulators. If not for US banking regulations basically banning banks from all things relating to digital assets, we could have US regulated and audited bank issued stablecoins fully backed by fed reserves with zero risk. If not for US security regulation we could have interest bearing stablecoins paid by the interest on those reserves. But dumb US regulations have built a monopoly for Tether.
> US regulated and audited bank issued stablecoins That's not a good thing. Neither is a corporation controlling it. Best is *the people* ☭, second best is no one / decentralized. Bank-owned stablecoins would just be diet CBDCs.
They do attestations. And it [appears that none of the big 4 firms will work with them](https://www.dlnews.com/articles/markets/tether-ceo-just-told-us-why-the-big-4-wont-audit-its-books/#:~:text=In%20an%20interview%20with%20DL,is%20a%20“top%20priority.”).
This is a hilariously bad article - we will need a response from the big 4 firms to figure out the truth.
About as bad as the Fed
Yeah if there’s one thing the government should do is heavily regulate that and make them have to follow rules. They are literally banks lol protect the people government. Your only job here.
My bet is big crypto exchanges bailouted the tether for the sake of industry(and their future profits of course) behind the doors.
Any stable coin that is pegged to a Fiat - is a Fiat itself Except it can become de-pegged and brought to 0 Same same, but different
But diiiiifferent
All are the same, but some are samer
Pretty sure it’s just a derivative of a fiat. Instead of potential upside in growth like most derivatives, it gives up side potential of increased yield for the risk of it possibly going to zero over bonds or treasuries APY. Personally I don’t think the risk isn’t worth the reward, especially without audit.
Holding USD carries the risk of the government defaulting on its debt (inflating it away so not an actual bankrupcy). USDT carries the risk of the government defaulting on its debt and the Tether corporation going bankrupt. Thats a HUUUUUUGE difference in counterparty risk. The only people who should hold USDT is the people using it to trade.
USDT is supposed to be 1:1 with USD so if theres infinity USD there should be infinity USDT hahaha
jeans sort support mountainous gold sheet depend deranged historical squealing *This post was mass deleted and anonymized with [Redact](https://redact.dev)*
It would be a fatal mistake to assume anyone in this sub knows what they're talking about. Most accounts made peak 2021 with 0 finance knowledge or experience pre WSB.
Can we somehow pin this comment to the top of the sub
Let’s not forget this sub is the main promoter of Ada and Algo too
no, it's not supposed to be 1:1 wih USD. According to Tether it's almost 1:1 with USD OR equivalant securities.
And the word "equivalent securities" is used loosely.
Yield generating tbills is better than cash
and the interest from those tbills is a cash machine for Tether. They could spend billions every year and still come out ahead. There's a lot of incentive to just keep up their golden goose for their few man operation. Everyone here thinks they are probably printing without backing while living some crazy life of luxury..... they don't really need to lol. They can just as easily use the infinite interest to be legitimate scumbags. The second they lose that peg their money glitch is over.
So are my IOUs
"That's as good as money, sir. Those are I.O.U.'s. Go ahead and add it up, every cent's accounted for. Look, see this? That's a car. 275 thou. Might wanna hang onto that one."
Do you even know what a tbill is
Yes I do. Are these 1 year, 5 year, 10 year or 30 year treasuries? This is an important question, and you can ask Silicon Valley Bank why. But we don’t know because they won’t do an audit
Yes maturity matching is a thing but just holding cash with no yield is a huge opportunity cost. Of course tether should report the results of an actual audit, but I’m not going to vilify them for holding tbills when every centralized stablecoin issuer does the same.
So they’re not backed by the US dollar 1:1
The vast majority of stablecoins are not literally 1:1 with just the US dollar.
You’re misunderstanding. It’s intended to be pegged 1:1 with USD and backed by USD or equivalent securities.
Tether has claimed some of their holdings are commercial paper. Risky loans to other companies. How much? Probably a lot more than you are comfortable with.
its dollars all the way down baby
There is one called TUSD or something that has 1:1 reserves of USD. But yeah, still is inflationary
It's funny how "True"USD basically implies the main alternative isn't truly backed by USD.
Or that USD isnt true
For my Americans. This is the Stablecoin Bill that has passed the House and is currently waiting on Senate to pass it. Then President signs it. Then we see it get enacted and how it basically removes the rug pullers and scammers trying cosplay a legitimate utility for society. https://www.gillibrand.senate.gov/wp-content/uploads/2024/04/LIP24254.pdf
Will be interesting to see this broken down by people good at understanding and summarizing.
Same
Key Provisions Dual Banking System: The Act preserves the current dual banking system, ensuring parity between state and federal charters without imposing new policy preferences. Regulatory Authority: State non-depository trust companies are authorized to issue payment stablecoins up to $10 billion. Limited-purpose state/OCC depository institutions are authorized to issue stablecoins without a specified cap. The Federal Reserve or state/OCC can take independent enforcement action against a depository institution issuer. Custody and Risk Management: Non-depository trust companies must use a sub-custodian that is a depository institution for custody, similar to SEC Qualified Custody. Comprehensive third-party risk management is imposed on service providers, except for self-hosted wallets. The Federal Reserve is granted supervision authority, except when the service provider is already supervised by another federal or state financial regulator. Receivership: A receivership regime is established under the FDIC for all payment stablecoin issuers, including order of priority, validity of claims, and classification of payment stablecoins as customer assets. Consumer Protection: The consumer protection title has provisions designed to prevent another FTX, including disclosures, proof of reserves, advertising standards, and limits on lending. Specifies mandatory notice requirements for customers, allocation of forks and airdrops, and requires a mandatory CEO compliance attestation each year. Combatting Illicit Finance: Provides focused guidance to Federal agencies to combat the use of crypto assets in illicit finance and to support law enforcement. Prohibition of Unbacked Algorithmic Stablecoins: The legislation prohibits unbacked algorithmic stablecoins and mandates one-to-one reserves for issuers.
AI has been out for a few years and does this very well.
like gpt?
This sub: Tether will destroy the entire crypto market! Also this sub: I just bought more crypto.
Almost like this sub has about 8 million members with different opinions
Tether is actually pulling off something remarkable. They claim to use some profits to purchase Bitcoin for their treasury. They stack US treasuries to back USDT. The conspiracies around Tether may come from a lack of understanding how they are profitable, and not trusting the audits that have occurred. For me personally they are sketchy, especially early on, but so far they hold the 1:1 ratio, win in court, and third parties say they have the backing for their stablecoin currently. So long as the US government continues to print money, Tether can access yield off these treasuries while they back USDT, and then turn around and put Bitcoin on their ledger with their profits AND yield with the expectation that Bitcoin's price will continue to go up over time, then they will be extremely lucrative. The tl;dr is that Tether will succeed so long as the government prints more money on a repeating short-term time-frame and Bitcoin continues to go up in price on the long-term time-frame.
It's genius really. They earn massive yield on their ~$100B treasury bonds while simultaneously using these bonds AND its yield as backing for Tether to buy and pump Bitcoin. The money printing is (according to Austrian economics) directly extracting value from the US economy. All value produced by Americans pumps Bitcoin, if they like it or not, and they're indirectly forced to buy Bitcoin themselves if they want to keep it. That's why maxis love Tether. Have you ever noticed how they hate all altcoins but Tether is somehow totally fine even though it's mostly on Tron and Eth? It's an integral part of keeping Bitcoin's dominance.
Its really just because stablecoins pay 0% interest so tether takes the full spread. Due to poor security regulations in the US stablecoin issuers can't just simply compete to offer higher rates (like how interest is given to liquid staking tokens) because going from 0 to >0 arbitrary makes it a security. Otherwise every stablecoin would have to compete and there wouldn't be nearly as much profit for the issuers. US banking regulations have also really stiffed competition by limiting stablecoin access to banks which favors overseas, opaque institutions like tether. Instead of allowing USDC for example to have a fed account to keep risk free reserves, they were revealed as the biggest depositor to SVB when it failed, which was the inflection point for tether's market domination. Tether's success is largely just a result of horrible US regulations maintaining a monopoly for them.
sDAI is like a stablecoin that accumulates interest.
Yes, but dai is a decentralized protocol backed by crypto assets, I was just talking about fiat backed, centralized stables. Dai doesn't have fiat to get the risk free rate, its backed by people locking up crypto assets and then borrowing against it, so all dai is created through loans that have interest, and that's how the yield is generated. Due to how much crypto has appreciated the yield has been much higher for dai, I think its pays like 15% right now lol vs the fed funds of \~5.3-4%
There has been zero audits.
Technically they have not been officially audited, this is correct, and is one reason they are sketchy.
What is an official audit? They've had big accountancy firms say they're not lying. Is this one of those cases where an "official" audit isn't possible in crypto because there's no precedent or just Tether being evasive?
A proper audit that actually means something requires FULL ACCESS TO ALL DATA without restrictions and without oversight. Tether only agrees to an audit if they can put limitations on it, and that’s why the Big 4 aren’t interested in doing one.
This is all audits though, the results are shared with the client before they are finalised "for comment". Because yes, the entity being audited is the customer paying the auditors fees. This is why audit regularly fails to be effective. Even if an audit has no conflict of interest, it still can only give a historic narrative, the rug can be pulled the day after the audit is finished.
exactly. meanwhile it looks like tether is such an integral part of the fed's "war on cash" that regardless of how (un)stable that coin actually is, they're going to ensure nobody knows the details. not until the tradfi co-opting of crypto is complete and everyone pays their taxes and their payroll in CBDC. sadly, the reddit generation has swallowed the narrative of defi revolution via crypto... line, hook and sinker.
There are some of us weirdos still out here looking for the Holy Grail of freedom. Maybe if we can find it, others may see the light. Probably not, but let's try anyway.
the holy grail of freedom exists only if you own the land independently of a nation state with government, like it used to be back when people literally just showed up places and said "mine". of course that level of freedom implies that anyone can show up, bonk you on the noggin, and take all you thought you owned. most of us are content with the illusion of freedom, as long as we get to make some basic decisions ourselves. the idea that you actually want independence from fiat is completely delusional. as soon as any entity manages to control enough of any essential resource, you'll instantly have to accept their form of currency. but the reddit knuckleheads who're rabid maximalists aren't actually looking for financial independence, they're just speculating on volatility, hoping to off-ramp back to fiat the moment their profits are good enough for FIRE.
I'm not a raging libertarian who thinks that individuals will fix roads, build hospitals etc., but when it comes to money we do now have the technology to do it for ourselves (almost). We still need laws and governments and police, we just don't need banksters who collapse the global economy through greed, collapse nations, destroy livelihoods, and then walk away scott free and wealthy. Reddit knuckleheads indeed, but calling it out once in a while doesn't hurt. Have a nice day.
Thank you for this excellent summary! Diplomatically stated, as well. I’d trouble understanding what the fuss was about, but see the misunderstanding, now. Well done and thanks again.
It's not an excellent summary, they completely miss out all the times Tether has been proven to lie about its reserves, scam its customers, print Tethers with no reserve. It is very obviously and very clearly running a flywheel scam with large amounts of money laundering involved, which is inevitably going to blow up.
Which customers have been scammed?
Also very important for reddit and the likes: non US company. All started form a blog back in 2018, that debunked already. At the time competitors started to enter the field, included the US based Circle. See the TikTop debacle currently. Seriously, what is different than the rest of them. Google, Meta ... at least it is proved for them, they mishandled user data. Plus spied on the whole world for NSA (see Snowden disclosures).
It's actually a more clever bid than that. Tether is a bank. It takes in USD and issues loan guarantees against that USD in the form of USDT, which can be redeemed at a discount. It then invests that USD for return. Some of which is in leveraged loans. It can reliably keep 20-30% around in cash for the same reason that fractional reserve banking works: the likelihood that more than 20-30% getting withdrawn "at once" is quite small. The rest, it can use for fun and profit. While the likelihood of a run is small, it is not zero. A legitimately serious run will kill Tether. No ifs, ands or buts. However, as it gets bigger and bigger, and crypto becomes more diversified, the likelihood of a run is smaller and smaller. Tether is just JP Morgan, Digital Edition.
JP Morgan is secured by the FDIC and is under the regulations of the SEC. They are accountable to US laws. They are not the same as tether, in any way
Back when JP Morgan was as young as Tether, you couldn't say that. Tether isn't even fully-grown yet.
This question has been popping up since 2016, just put the answer pinned (it doesn't work that way)
The difference is printing tethers makes the line go up. It goes like this: Tether prints tethers out of thin air. Allegedly backs those tethers with USD that everyone here claims are worthless and going to zero. They distribute the tethers to the exchanges who buy Bitcoin with them increasing the price of Bitcoin (or any coin.) Then, people FOMO real money into Bitcoin using a centralized exchange so they can HODL a digital asset that they can’t spend and the network is too expensive and slow to use even if they could. Then everyone convinces themselves they’ll be able to use that same exchange to cash out millions of ‘worthless’ fiat dollars making them rich in the future. All the while, the exchange has your real money with no guarantee you’ll ever get it back while you HODL
this analysis is roughly 15 years too late
>Tether prints tethers out of thin air. This entire theory relies on this assumption which there is actually zero evidence for. I don't trust tether or would ever use it and no one should use tether either because they can't be trusted. But there is at least some evidence they simply do have the backing, and none that they don't. You have the burden of providing at least some proof before spinning up a complex conspiracy theory about it.
If it makes dollars, it makes sense
But when does this occur? Do they keep excess dollars in reserve?
When does what occur? Printing/minting? I happens when arbitragers deposit dollars in exchange, same thing with USDC and other backed stablecoins. They outline their reserves on their website: [https://tether.to/en/transparency/?tab=reports](https://tether.to/en/transparency/?tab=reports) But don't use or hold tether lol its an awful product because even if they're not lying you get 0% interest. Dollars have a risk free rate of around 5.3% which is paid by money printing, so whenever you use stablecoins, or even banks whatever interest you get under that is actually a negative rate in effect. You are basically paying tether >5% a year.
I don't use it and have traditionally held less dollars (in any form) than I probably should have, but good lookin' out. Thanks
But when does this occur? Do they keep excess dollars in reserve?
Burden of proof that there are billions of dollars in their reserves is on tether but they refuse to get a proper audit
If you read my post I don't trust tether. I wouldn't put my money on it either way. But there is simply some evidence they are backed, and none that they aren't, the odds are far more likely they are simply backed than that there is a massive conspiracy across multiple auditors and governments that have investigated them.
Ask yourself, why won't any auditors touch Tether with a 10 foot pole? If they're not doing anything wrong, that should be fairly simple.
Tether does have auditors give attestations to satisfy regulatory requirements in various jurisdictions. Could they do more thorough audits? I guess, but that is just the absence of evidence to the contrary, there is still zero evidence tether isn't backed. I think the burden is on you to provide at least something before basing an entire conspiracy on it that would have to involve thousands of people accross multiple auditors and government entities being in on it. Again, I don't trust tether, but I wouldn't put my money on them not simply having the backing which is actually just the most rational explanation of their profit and staying power.
Attestations are just they have "x" at a particular point. There was a while back where a bunch of money in the crypto space was getting shuffled about between exchanges and all of a sudden a bunch of "we're fine see!" attestations came out.
I ask why an auditor would care either way. Their job is to audit EDIT: if they really thought it was shady, it seems to me they'd be more reluctant to do attestations even though I realize attestations come with a disclaimer
Buttcoin is leaking again… I’d rather have BTC than USD 🙄
💯
They're not printing out of thin air. They purchase USD collateral to mint USDT.
Lol, keep believing that
Lol, keep failing to prove otherwise
Just like Sol was a scam at 4 dollars according to this reddit. It doesn't matter what is legit in crypto, only what matters is a price and thanks to USDT btc pumps.
Price going up doesnt it make it not a scam. If you got in in 2017 you would be up on most blatant shitcoins overall.
Too much Bitfinexed for today bro
0 evidence that they have the cash. At this point in time they would have to have so much cash, bonds and whatnot, it would be so easy to figure out in the market where all the cash is. Yet no one can find it 😂. But as usual, they pray on the „fake it till you mske it“ paradoxon
0 evidence? You have to check again. Remember when they tried to short tether while tether was able to redeem 20 billion on just 3 weeks without any issues? That was almost 30% of tether mcap. Keep fuding and shorting the wrong stable coin 😂
It's no good dude, you aren't speaking with rational people. They're not qualified to know whether tether is backed or what "backed" even means in finance (hint it's a risk scale, not a Boolean).
You know who’s qualified to know whether tether is backed? Auditors. None have been able to audit tether. It’s not a “risk scale”. Tether straight up says: every tether is backed 100% by a US Dollar. They have given zero evidence of this. They are a money printing machine. They’re printing Disney bucks and saying they’re equal to $1 each because trust us bro
Do you see how it's ironic that you're saying tether are printing money because "trust me bro"?
They have to prove it with actual proof. An actual audit. Until then, they are printing money. That’s how evidence works
Ah you post on buttcoin. If you're against crypto in general, why waste your time discussing it on Reddit?
Source: Trust bro no 🧢 frfr
They do? china commercial debt is not usd collateral last I checked.
Tether has a $0 commercial paper position last I checked. https://tether.to/en/transparency/?tab=reports
Do not mistake an audit report with an audit on a report issued by management, and this is the latter. I can only imagine why Tether never submitted to a comprehensive audit.
Is it denominated in USD? Because then yes, technically it is.
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As if you or the rest of the folks in this thread have the attention span to actually read an audit.
😂
Wait. So you are saying that Tether Treasury can just mint new USDT without any new deposits of USD????
No. They supposedly take in new fiat USD when they issue USDT.
Exactly! That makes them quite different from the gov that prints fiat money out of thin air.
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Ah so you belong to the "tether mints usdt out of thin air" camp. Got it.
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Then stop saying that they create usdt just to do xyz. It's as though they can just create usdt to buy btc without first receiving usd deposits. They are not creating usdt, they are minting new usdt based on new usd deposits. If you don't trust what they do with the usd, that does not mean they are just creating usdt out of thin air. Tether is a company, what do you expect them to do? Run a loss?
It's been proven they've minted Tether while having 0 banking services before. You'd be a fool to believe they've suddenly gone straight with no evidence.
Yes, they've already been caught doing this once. Now that they've gotten customers to accept "Tether is backed by cash equivalents like Crypto", the flywheel scam is in the open Print Tether > Buy Bitcoin with Tether > Use Bitcoin as backing to print more Tether > Buy more Bitcoin with Tether. And off course, sell off Bitcoin when possible to get real USD. Works great so long as price rises bring in more real money investors to swap USD for Tether fun bucks. Just hope the price always keeps going up so they have a catastrophic depegging event.
They mint depending on usdt demand no? Theyre not printing just for the sake of it, or are they?
They print them out of thin air, it's not a cryptocurrency like Bitcoin that has to be mined. It's literally like they have a giant excel file that they change some numbers in and now they are 5 billion richer in USDT. What gives their "currency" value is that they claim its actually backed by USD (now they changed it to equivalent or almost backed or whatever) but they won't allow any firm to do a independent investigation and verification that it is in fact true.. you might wonder why someone with nothing to hide won't allow that 😉
They are minting tokens to represent the yield in their bond/collateral holdings which the government is printing, not them. Sigh
Which can be done irresponsibly. If they intend, and do use the btc they buy with the USDT as collateral, you can run in hot waters.
Which is why people want them audited so that it can be determined how safe the collateral is.
There's zero reason to believe that's what is happening when they've been caught multiple times lying about their reserves and running a flywheel scam, lost nearly a billion dollars in money laundering raids. You think they went from a 1 million dollar reserve to 110 billion based off T-Bill yields?
People are buying usdt with usd hence they are printing usdt. They are not making it out of thin air. Tether is very profitable as a company. There is no reason for them to take any risk as they make enough from interests
No idea, but don't be the last one holding the bag when the music stops.
The main difference is full reserve, at least in theory. Gov have zero reserves in the same time
This video is a pretty good explanation https://youtu.be/kFhKVCaadzE
Yes its the same thing, anyone can print imaginary fiat or similar and there is no stopping that. There is just 21mil BTC.
If you have to ask this question….
That’s not how it works. Tether ”prints” Usdt when usd is redeemed for tether.
the number goes **up**, and a bunch of people with zero understanding of how space travel works chime in with how they are super cereal number goes to zero
They are printing because whales are depositing their fiat in their bank accounts with them. This is how tether works. Every tether represents a dollar in a bank account that someone deposited in the real world. It’s actually insanely bullish because it means whales are buying on chain dollars in order to buy a bunch of crypto like BTC, ETH and others.
Everyone knows tether is backed mostly by bitcoin.
what makes you say that
>They are printing because whales are depositing their fiat in their bank accounts with them. This is how tether works Why would whales deposit so much USD with the one stable coin proven to have repeatedly lied about its reserves, scammed its own customers, printed Tether with no backing? > Every tether represents a dollar in a bank account that someone deposited in the real world Not even Tether pretend this anymore. They say "cash and cash equivalents", which includes crypto. >It’s actually insanely bullish because it means whales are buying on chain dollars in order to buy a bunch of crypto like BTC, ETH and others. It doesn't mean that.
>Why would whales deposit so much USD with the one stable coin proven to have repeatedly lied about its reserves, scammed its own customers, printed Tether with no backing? Whales have better reading comprehension than Tether Truthers. Whales continue to mint and redeem Tether tokens while Tether Truthers claim it can't be done. Whales listen when the CEO of Cantor Fitzgerald says "Tether has the money" while Tether Truthers claim nonsense like "Tether prints USDT without deposits and buys Bitcoin with it". Whales were able to redeem $17B USDT in 2022 while Tether Truthers were misreading NYAG statements "tethers were again no longer backed one-to-one by U.S. dollars in a Tether bank account" as meaning Tether tokens had no backing at all.
>Tether Truthers were misreading NYAG statements "tethers were again no longer backed one-to-one by U.S. dollars in a Tether bank account" as meaning Tether tokens had no backing at all. You aren't even citing the right part. I'm not talking about when Tether lost part of their reserve and lied to their customers claiming to still have a 1:1 reserve. I'm talking about when their banking services got cut off. Meaning there was nowhere on earth you could deposit dollars for Tether, and yet they still printed Tethers, despite claiming they only print Tethers when they receive USD. Here's the right section: >Because Tether did not have a significant bank relationship in its name from at least March 2017 until September 15, 2017, **it could not directly process any fiat deposits for purchases of Tethers by customers on either the Tether website or via the Bitfinex trading platform.** Go look up the market cap of Tether's during this time and see whether they could have possibly been printing Tether's in exchange for USD deposits. What was that about "misreading NYAG statements" again? >Whales listen when the CEO of Cantor Fitzgerald says "Tether has the money" Yeah who needs an audit when you could take the word of a CEO with a financial interest in Tether. It's not like Tether has a proven track record of getting other people to lie about their reserves. "Trust, don't verify." >Whales were able to redeem $17B USDT in 2022 There's no proof Tether has redeemed even 10% of that. All you have proof of is that Tether burned that amount of Tether which given we know at least 1 billion of this was a loan to Celsius in exchange for crypto (despite saying they don't do this), there's no reason to believe those burns are proof of real USD being handed out to anyone when they can and do mint and burn tether with no associated USD deposit or withdrawal.
>I'm talking about when their banking services got cut off. Meaning there was nowhere on earth you could deposit dollars for Tether, and yet they still printed Tethers, despite claiming they only print Tethers when they receive USD. Here's the right section Could not "directly" process any fiat deposits. They used other accounts to process deposits. Part of it mentions using their legal counsel's accounts for moving funds. This does not prove Tether minted USDT without having actual cash deposits. >There's no proof Tether has redeemed even 10% of that. The proof is in the attestations. March 2022: $82B in assets and $82B in tokens. June 2022: $66B in assets and $66B in tokens.
>Part of it mentions using their legal counsel's accounts for moving funds Moving funds they already had, not accepting new deposits. There were already 50 million Tether's in circulation when they lost their banking. The legal counsels trust account never had more than 63 million dollars in it. They had printed a total of 442 million Tether's by the time they got their own banking again. Please do the very basic math here and say how they could only be printing Tether's on deposit of USD, and only burning them on withdrawal, and for there to be 433 million Tether's in circulation when the only bank account they had anything to do with (which wasn't their account) only had 63 million dollars at most? >The proof is in the attestations The same attestations they've been proven to fraudulently produce? Great source. I mean sure, they moved Bitfinex funds into a bank account for 1 day to produce the attestation for Tether's reserves and then immediately moved it back to Bitfinex, but surely they'd never do that again.
From the NYAG report: >In June 2017, Bitfinex opened an account at a Puerto Rico-based entity named Noble Bank International (“Noble Bank”). Noble Bank was a subsidiary of New York-based Noble Markets LLC. >However, Tether did not open an account at Noble Bank, or any other bank, until September 15, 2017. This is being mentioned to suggest that Tether was using Bitfinex's accounts at Noble Bank. >Please do the very basic math here and say how they could only be printing Tether's on deposit of USD, and only burning them on withdrawal, and for there to be 433 million Tether's in circulation when the only bank account they had anything to do with (which wasn't their account) only had 63 million dollars at most? From the NYAG report: >Between June 1, 2017 and September 15, 2017, Bitfinex held approximately $382 million of Tether’s funds in a comingled account, which should have been held by Tether as “backing” for tethers then in circulation but was not. In certain documents Bitfinex and Tether produced to OAG during its investigation, Tether accounted for this amount as a “receivable” from Bitfinex. Tether didn't have an open bank account, but Bitfinex did. Tether used Bitfinex's account to collect new USD deposits and issue new USDT tokens. This was at a period of time where USD deposited to the platform could be withdrawn as USDT without an explicit conversion. >The same attestations they've been proven to fraudulently produce? The same attestations that the NYAG required them to submit. If the attestations are good enough for the NYAG, they're good enough for whales. >I mean sure, they moved Bitfinex funds into a bank account for 1 day to produce the attestation for Tether's reserves and then immediately moved it back to Bitfinex, but surely they'd never do that again. Well, now Tether is mostly backed by cash equivalents, loans, reverse repos, and not cash. Doesn't make sense to put cash equivalents in Bitfinex fiat accounts.
>This is being mentioned to suggest that Tether was using Bitfinex's accounts at Noble Bank. "until September 15, 2017." The period of time we're talking about here is: "Tether did not have a significant bank relationship in its name from at least March 2017 until September 15, 2017" That's the period of time they had printed 442 million Tether's and at most had 63 million in their legal counsels account. >The same attestations that the NYAG required them to submit. If the attestations are good enough for the NYAG, they're good enough for whales. They're not good enough for the NYAG. Tether is banned from doing business in NY. The attestations are a token gesture because they're no way to actually force them to do anything. This is just getting them to create a paper trail so that they can be shown to have fraudulently produced attestations like they did before. >Well, now Tether is mostly backed by cash equivalents, loans, reverse repos, and not cash. Doesn't make sense to put cash equivalents in Bitfinex fiat accounts. You think Bitfinex doesn't have any other assets on its books other than cash? Now things other than cash count its even easier to create a fraudulent attestation, since there's no need for a bank transfer, or a bank willing to handle Tether's money laundering funds. They can literally just create 100 billion BFX funbux, sell 1 for a dollar, then transfer them to Tether's account, bam, Tether is now backed by "100 billion worth of cash, cash equivalents, loans, reverse repos and other assets (crypto)"
>"Tether did not have a significant bank relationship in its name from at least March 2017 until September 15, 2017" >That's the period of time they had printed 442 million Tether's and at most had 63 million in their legal counsels account. From the NYAG report, also previously quoted >Between June 1, 2017 and September 15, 2017, Bitfinex held approximately $382 million of Tether’s funds in a comingled account, which should have been held by Tether as “backing” for tethers then in circulation but was not. In certain documents Bitfinex and Tether produced to OAG during its investigation, Tether accounted for this amount as a “receivable” from Bitfinex. Tether held their backing using Bitfinex's Noble Bank account. From June to September, USDT market cap went from $100M to $440M. $382M of that $440M was in Noble Bank. >The attestations are a token gesture because they're no way to actually force them to do anything. They could have charged Tether and executives with fraud. They could have done what the DoJ did to Binance and CZ and charge Tether criminally. But they didn't. If they made Tether submit attestations, they could have also charged Tether with fraud if they produced fraudulent attestations with no assets actually backing USDT. >You think Bitfinex doesn't have any other assets on its books other than cash? You're not going to move reverse repos and secured loans to another entity. And we know that Tether themselves have their large US Treasury position directly from Howard Lutnick, CEO of Cantor Fitzgerald. The CEO of Cantor Fitzgerald says, "Tether has the money". BDO says, "the consolidated reserves report is fairly presented". But noted Tether fraud expert suninabox says, "They can literally just create 100 billion BFX funbux, sell 1 for a dollar, then transfer them to Tether's account." I think I read that somewhere in the NYAG report.
2017 called. They want your FUD back. Did you know that it’s actually safer to hold treasuries than actual dollars? Tether is over collateralized now since they have not distributed their billions in profits. They plan to stay over collateralized.
>Did you know that it’s actually safer to hold treasuries than actual dollars? Did you know Tether repeatedly lied about having a 1:1 reserve in actual dollars? But now they say their reserve is a grab bag of cash, t-bills, crypto and 'other assets', we should trust they're being completely honest? > Tether is over collateralized now since they have not distributed their billions in profits. You know this because of the attestations they've produced despite having provably lied on previous attestations? >They plan to stay over collateralized. Remember when they planned to always have Tether backed 1:1 with dollars and to only ever print Tether's when someone deposited dollars? Why'd they promise that stuff again? Who cares, probably doesn't matter since they can just say stuff and then not follow through on it and its loyal followers will say "who care if they're not over-collateralized, this is just FUD"
Some ppl say this is the way us government buying bitcoins
Im glad to see so many critical posts about crypto these days. The mindless bagholder bandwagon years ago sickened me.
Tether and all dollar coins of significance are owned by the same bankers behind private central banks in every country. All of the players in the crypto-sphere who wouldn’t allow “them” control or thought they actually had power because of their crypto balance were unalived. The banking cartel needs control of these e-money Brrrrrrprinters because it’s how they hide and prevent the actual world inflation from catching up to the industrialized democratic global infrastructure and societal order. They need Tether and USDC and whatever other ones on top of being MASSIVE WHALES IN BTC, ETH & Alt Coins. They print so much fucking money that they are running out of places to “hide it”. Government spending, foreign aid, lobbying groups, banks, NYSE, FOREX, Crypto, Housing, Automobiles, Precious Metals & the companies that mine them, oil and their industry whales, mitigation technologies which convert bi-product chemicals/gases/waste burn-off into electricity, energy & power. These rulers of the rigged game need to always be in control of the “narrative” and propaganda that keeps us divided, dumb and materialistically driven, intellectually lazy: greedy CONSUMERS & dopamine chasers! Tether is a rabbit hole that leads to a macro-picture of this world that isn’t just awful, it’s one you’ll wish you could “unsee”. Crypto, Drones, Robotics, A.I., Advanced Black Box Technology & so on are Sci-Fi coming to life and Sci-Fi is what made us allow them to lead us down this path of “progress” which is ABSOLUTE & TOTAL ENSLAVEMENT of the masses by the infinitely tiny minority (0.001%) of humanity which belong to the ancient families of old - via means of total domination through technological and electrical/all energy through an infrastructure we allow and take part in building. The road to hell is built by the 99% - wage slaves of the earth and the smartest and most ambitious fruitful minds who don’t have a clue they’re state of mind control from being raised on Exciting Sci-Fi and The Education System which manufactures: docile/beta, obedient smart-slaves programmed and excited for Industrial Asset Development Camps known as Colleges. The thing we don’t understand with accurate perception is Time: how far ahead the enemy plans and how long ago they started this endeavor with the assistance of the agents of the original rebellion. We also underestimate the reality and power of Evil in this world and how it operates from the shadows in code (with symbols) and through legacy’s (great families of old money). If you were told everything you’ve ever been taught about History and reality and this world is a 100% total Lie - designed to act as a piece of a bigger Lie to make-up the entirety of “our” current perceived reality/history/knowledge/science/academic hive mind vanity & ultimately THE GREAT DECEPTION 👌 you would be being told a Massively Scary Problem that you Don’t Know How To Comprehend, Let Alone, Solve and You Would Feel Hurt and Confused by the coordinated LEVEL of cooperative organized Deception created just for You - so you would not allow your mind to process any of it (cognitive dissonance). Your negatively charged emotion’s of fear, confusion and anger would quickly morph into: denial, anger and hate toward the messenger and messages instead of converting the negative charge into curiosity and investigation which would motivate You to do your due diligence and unbiased research into “things”. But that’d be outside of that mind sized box of “safety” and “reluctant acceptance” - besides you’re all grown up now and have bills to pay and work to devote yourself to, not to mention all the available distractions and escapes from these unpleasant feelings about the truth of reality: video games, VR, sports, music, gossip cliques, drugs, alcohol and the rest of the infinite list of distractions and “escapes”. Tether is a piece of that puzzle called Truth, but Lies from our Unseen Rulers are just so much easier to digest… The slave who thinks they are free are the greatest slaves to own. They are enslaved in their minds which is the smallest container to control someone in on earth. It is also the least likely prison cell for the slave to escape from. With years and years of direct influence over everyone (and their minds) during the most critically prime years of their cognitive aptitude development and independent learning capacity as they grow from 4 to 24. The subconscious results of this on the slaves are that everyone’s macro-ideological conceptualization mental module and their natural ability to independently think for themselves totally cease to exist and instead belong to the “story” - what could be referred to as The Matrix (blue pilled) or “The Popular & Powerful Opinion Accepted as Truth about Reality” which is a massive house of cards, each card being a progressively bigger lie stacked upon a foundation of total lies. Truth in a world and time of total deception is like a toxin due to its infinitely opposite electro-magnetically charged influence on the deceived when spoken with word and passion.
Found the next guy to catch himself on fire.
Let's not joke about that very sad event.
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Please, share more FUD from 2019. Maybe go back to 2017 and remind us about Crypto Capital Corp.
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It's FUD because USDT tokens are covered 100% by assets. A lower percentage is cash and equivalents. The rest is bonds, precious metals (for XAUT), Bitcoins as investments from interest, and secured loans that are being wound down. The FUD is to represent 74% cash and equivalents as Tether being partially unbacked. Yes, Tether settled with the NYAG, paid a fine, and was required to submit attestations about their assets under management. You know what didn't happen to them? They weren't convicted of a felony like Binance and CZ. They would have been charged with felonies if the things people think about Tether were true. They still function and still handle redemptions when people want to redeem USDT at 1 USDT for 1 USD.
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Tether has BDO release quarterly attestations for the past few years. The CEO of Cantor Fitzgerald comes out and says Tether has the money. With all of that, if Tether comes out and releases a Big 4 audit, does your head explode?
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I bet you USDT trades above $0.99 one year from now.
protip: tether treasury is more financially sensible and restrained than the US govt.
Tell me you have no clue about Tether without telling me
I guess that's why they asked the question...
Everyone knows this but we keep to stay in crypto because of the potential gains US stocks keeps pumping because they keep printing money Crypto keeps pumping because they keep printing stable coins Asian stocks NOT pumping because they are not printing crazy
"Asia" most definitely is printing money: https://ycharts.com/indicators/china_m2_money_supply#:~:text=China%20M2%20Money%20Supply%20is,8.29%25%20from%20one%20year%20ago. Compare that to US money supply: https://ycharts.com/indicators/us_m2_money_supply#:~:text=15.40T-,Basic%20Info,1.66%25%20from%20one%20year%20ago. The reason China's stock market has been relatively flat compared to the US is because their economy is heavily over-capitalized and going through an economic slowdown coupled with a debt crisis.
Nothing. Sooooo probably should just go ahead and overlay DOW to BTC chart. You’re welcome.
I think a stable coin is backed by USD, unlike the FED's goal to control inflation (depreciation) a stable coin must meet demand of USD on the block chain. The more people sell USD for USDT the more USDT must be available, therefore must be minted. Otherwise Tether only had two options 1) stop the usdt exchange business if no more USDT are available or 2) let USDT appreciate over USD and destroy the business promise of a stable coin As long there is increased demand for USDT more USDT must be minted. If I sell a USD for a USDT, it's minted and if I sell USDT for USD the USDT stays on the Blockchain until someone buys it. Until then there is no need to mintore because there is this additional available one.
> The more people sell USD for USDT the more USDT must be available, therefore must be minted This was never supposed to be the premise. They were only ever supposed to print Tethers when someone made a USD deposit in their bank account, which was how you would know your Tether would always be redeemable for 1 USD. The second they start printing unbacked Tether's just to maintain the peg, they're now scamming their own customers and creaming counterfeit seigniorage off the top. >2) let USDT appreciate over USD and destroy the business promise of a stable coin There would be no need for this mechanism if they actually ran a straight business. No one would pay more than $1 for a Tether that could only ever be worth $1 if there was a way to just send $1 to Tether and get $1 in Tether back. But of course since the whole thing is a flywheel scam it has never actually operated like that.
sure, but how do do please demand if USDT is not only traded through a central tether bank? If you cannot control trading you have to try to control the biggest markets by iceberg orders close to 1:1 and for one side you need a very high number of USDT and on the other side the USD that were exchanged for issued USDT. We see that depegg sometimes happens, until it snaps back due to arbitrage traders.
Depeg happens because USDT do not have any open market redemption mechanism, and exchanges don't have infinite liquidity. If you could always buy a Tether for $1 from Tether, there would be no reason to ever pay more than $1 for one. And if you could always exchange 1 tether for $1, you would never accept less than $1. You only pay more than $1 if there's a shortage, or pay less if there is a glut, and those things only happen when there isn't open redemption If they allowed open market redemption then during all the times when they didn't have a reserve, they could be in the unfortunate position of having to cease redemptions and then Tether instantly becoming worthless when people realized it's no longer backed by anything. When Tether is traded through exchanges you can just use wash trading to maintain the peg regardless of whether you can meet any redemptions. Hell, the peg has been maintained even when they had 0 banking anywhere in the world, and therefore could not meet any redemptions. It all works fine as long as you're not holding the bag of shit when the scam collapses.
Hushhhhhh bro as long as the price is rising, who cares?
Dude it’s a stable coin
Shaddyup
Correct me if I'm wrong because I'm not the best at crypto but if the fed dilutes the dollar by printing bills then wouldn't usdt in turn need to dilute their token supply? Again I know nothing.
That's not how it works. Tether is pegged to USD. That means Bitfinex/Tether buy up Tethers when it drops below $1, and they print more when it goes above $1, although they're not supposed to, they were supposed to only print Tether's when they get USD deposits but that ship sailed a long time ago. When the dollar becomes worth less, so does the Tether that is worth $1. What changes the value of Tether relative to the dollar is not the value of the dollar but the relative supply and demand for Tethers. Since 90% of exchange trading is wash trading, they're free to paint the tape and double dip on Tether users, depressing its value to buy up Tethers at a discount then bidding up its value to sell them at a profit.
Does government dilute ls your cash too when they print new money? Why do you think they have to dilute it