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Tether is supposed to be backed 1:1 by US dollars and function as a non-volatile way to move money across exchanges. It's market cap is ~$815M. Lots of people b
by econner 9y ago
Tether is supposed to be backed 1:1 by US dollars and function as a non-volatile way to move money across exchanges. It's market cap is ~$815M. Lots of people believe that Bitfinex, the creator of Tether, is not actually holding $815M to back it. Instead they believe Bitfinex is creating Tether out of thin air and could be using it to inflate the price of Bitcoin.
- simooooo 9y agoHow would them issuing tether out of thin air inflate the price of bitcoin?
- fmela 9y agoBy trading tether issued out of thin air for BTC.
- deleted 9y ago[deleted]
- RexetBlell 9y agoWhy would anyone want to exchange their Bitcoins that are worth over $10,000 each on Coinbase (and can be converted to real dollars) for some tokens that are backed by nothing?
- cantrip 9y agoTether are, ostensibly, backed by $1 in a bank somewhere. Having a dollar token is very useful, since you can move in and out of crypto trading positions into a stable store of value, good old USD. Converting to real money takes a long time so you can't react to the market, and is also taxable and often has other fees on top.
- michaelchisari 9y ago> backed by $1 in a bank somewhere. Are we sure about this?
- tehlike 9y agoConverting to another coin is also taxable. Similar to selling a stock.
- Zpalmtree 9y agoGood place to park your gains when the market's volatile.
- corysama 9y agoIt’s used to move large amounts of dollars between exchanges that don’t want to deal with the regulations involved in moving large amounts of dollars.
- runeks 9y agoIn my experience, no one has a satisfying explanation for this. Nor why this would affect the USD price of bitcoin.