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> Tether has a blockchain How can they create new tether on demand if it's backed by a blockchain? Do they control all the mining?

by Kiro 9y ago

jacobush 9y ago
Something like that.
- fiatjaf 9y ago
  Stupid, right? Why don't they just use a Postgres database?
  - ForHackernews 9y ago
    Because the cryptocurrency set is more easily impressed by a "blockchain" than a "database". E.g. this nonsense: http://www.ibtimes.com/un-will-use-blockchain-ids-fight-child-trafficking-2613948 http://www.ibtimes.com/un-will-use-blockchain-ids-fight-chil...
    - fiatjaf 9y ago
      Amazing.
  - trophycase 9y ago
    Because then we wouldn't have a known number of issued coins as well as the full set of holders of those coins? Nor would we be able to trustlessly send them anywhere?
    - runeks 9y ago
      > Nor would we be able to trustlessly send them anywhere? That’s not the case anyway, since Tether can retroactively refuse to honor tokens that were allegedly stolen. What if the attacker had traded his 30m Tether-USD in exchange for bitcoins? Then the seller of these bitcoins would be left holding the bag, because the central party that is Tether refuses to honor these obligations. Tether can never be trustless, because it’s credit. Some party needs to redeem tether tokens for USD, and if that party refuses to do so then your money is gone.
      - ojr 9y ago
        people who hold Tether trust the Tether system that is enough to keep the peg to the dollar for now, but I have doubts the peg holds
    - fiatjaf 9y ago
      I don't understand your point. Are you saying Postgres is not capable of storing a list of accounts numbers with balances? Also, how is something "trustless" if all the miners and validators are run by the same person?
JohnJamesRambo 9y ago
It is not really on its own blockchain. Tether exists on top of the bitcoin blockchain through the OMNI layer protocol. I discovered this the hard way by trying to transfer some Tether once and it was taking forever and I researched why. Bitcoin itself is very slow due to congestion from the silly 1 mb blocksize limit and 10 minute blocks.

> Tether has a blockchain How can they create new tether on demand if it's backed by a blockchain? Do they control all the mining?

by Kiro 9y ago

> Tether has a blockchain How can they create new tether on demand if it's backed by a blockchain? Do they control all the mining?

jacobush 9y ago

Something like that.

fiatjaf 9y ago
Stupid, right? Why don't they just use a Postgres database?
- ForHackernews 9y ago
  Because the cryptocurrency set is more easily impressed by a "blockchain" than a "database". E.g. this nonsense: http://www.ibtimes.com/un-will-use-blockchain-ids-fight-child-trafficking-2613948 http://www.ibtimes.com/un-will-use-blockchain-ids-fight-chil...
  - fiatjaf 9y ago
    Amazing.
- trophycase 9y ago
  Because then we wouldn't have a known number of issued coins as well as the full set of holders of those coins? Nor would we be able to trustlessly send them anywhere?
  - runeks 9y ago
    > Nor would we be able to trustlessly send them anywhere? That’s not the case anyway, since Tether can retroactively refuse to honor tokens that were allegedly stolen. What if the attacker had traded his 30m Tether-USD in exchange for bitcoins? Then the seller of these bitcoins would be left holding the bag, because the central party that is Tether refuses to honor these obligations. Tether can never be trustless, because it’s credit. Some party needs to redeem tether tokens for USD, and if that party refuses to do so then your money is gone.
    - ojr 9y ago
      people who hold Tether trust the Tether system that is enough to keep the peg to the dollar for now, but I have doubts the peg holds
  - fiatjaf 9y ago
    I don't understand your point. Are you saying Postgres is not capable of storing a list of accounts numbers with balances? Also, how is something "trustless" if all the miners and validators are run by the same person?

JohnJamesRambo 9y ago

It is not really on its own blockchain. Tether exists on top of the bitcoin blockchain through the OMNI layer protocol. I discovered this the hard way by trying to transfer some Tether once and it was taking forever and I researched why. Bitcoin itself is very slow due to congestion from the silly 1 mb blocksize limit and 10 minute blocks.