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People are holding Tether and don't realize it. Most BTC/USD exchanges aren't BTC/USD exchanges, they're BTC/USDT exchanges, but that "T" is stuffed behind an a
by Jasper_ 9y ago
People are holding Tether and don't realize it. Most BTC/USD exchanges aren't BTC/USD exchanges, they're BTC/USDT exchanges, but that "T" is stuffed behind an asterisk. People that want to make profits don't realize they're not actually cashing out for $10k, they're cashing out for 10k USDT.
As soon as they wired USD to one of these exchanges, they were stuck holding USDT. They could take the BTC and run to another exchange like Kraken, but that has transaction fees associated with it and they don't want to lose ~10% of their investment.
- vkou 9y agoThat is amazing. So, the exchanges turn USD into USDT, and the reason they sucker people into that trade is because you can buy more BTC on them... Because BTC is the only way that you can get wealth out of the exchange. So, USDT is not actually useful to anyone, except people trying to fleece crypto-traders. I love we are re-inventing all the best parasitic parts of the fiat financial ecosystem.
- tim333 9y agoWell not really - the main reason exchanges use USDT rather than USD is so as to not to have to deal with KYC like regulations associated with holding USD.
- tim333 9y agoThe fees for cashing out via Kraken are way less than 10%. Also checking just now bitcoin is trading for about usd 8100 on Kraken and usdt 8060 on Kucoin so there doesn't seem much problem at the moment there.