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The fact the Tether who issued USDT for presumably something around $1 aren't buying it back themselves for an easy profit should tell you something.
by nwellnhof 8y ago
The fact the Tether who issued USDT for presumably something around $1 aren't buying it back themselves for an easy profit should tell you something.
- mtgx 8y agoIt doesn't tell you anything. Maybe they think the bitcoin price is going to shoot up 3xin the coming months so using their money to buy tether would be pretty stupid in that case no? This is actually why it's so hard to tell from this whether or not this is something bad or just "normal" because tether price always reaches lower levels like this when people get out of it to buy cryptocurrencies, too.
- michaelt 8y agoMaybe they think the bitcoin price is going to shoot up 3xin the coming months so using their money to buy tether would be pretty stupid in that case no? For Tether to be backed by US$, for every 1 USDT they need to hold $1 in cash or cash equivalents. If they have invested the fiat in bitcoins, they aren't backed by US$ any more.
- caf 8y agoThis is right - Tether buying back their USDT means that they get to retire 1 USDT for 0.95c of their backing reserves, turning the remaining 0.05c into profit which they can then invest wherever they want.
- deleted 8y ago[deleted]
- londons_explore 8y agoI see these possibilities: * The tether organisation doesn't have an effective way to buy back tethers. They might not have the processes/infrastructure in place. * The tether organisation doesn't have the USD in liquid enough form to do said purchasing. For example, it might be in frozen bank accounts or offshore and take many days to transfer. * The backing USD doesn't exist entirely.