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Tether has long been suspected of being a complete and total fraud, a wildcat currency propped up by mere promises, not proof, of backing cash. Exchanges have

Tether has long been suspected of being a complete and total fraud, a wildcat currency propped up by mere promises, not proof, of backing cash. Exchanges have also been suspected of manipulating prices to liquidate future positions, there’s literally a twitter account dedicated to force liquidated Bitmex position. When every player is operating in bad faith it is very hard to come up with a legitimate way to protect yourself other than not participating.

darawk 8y ago
> Tether has long been suspected of being a complete and total fraud, a wildcat currency propped up by mere promises, not proof, of backing cash. Those suspicions have always been extremely poorly grounded. > Exchanges have also been suspected of manipulating prices to liquidate future positions, there’s literally a twitter account dedicated to force liquidated Bitmex position. Not by anyone serious. Sure, people get liquidated all the time because they don't have enough maintenance margin. The risks are very clearly defined, and all you have to do is read them. > When every player is operating in bad faith it is very hard to come up with a legitimate way to protect yourself other than not participating. There is no evidence that the major exchanges are operating in bad faith. And even if they were, what is your point? My point is that they could have neutralized the currency risk of their assets. And that point is absolutely true.
- pgwhalen 8y ago
  > Those suspicions have always been extremely poorly grounded. I am really quite ignorant on the issue, but they seem to me like reasonable suspicions when Tether’s purported “audits” are anything but.
  - village-idiot 8y ago
    They no longer claim to provide audits.
    - darawk 8y ago
      The fact of the matter is the market continues to value Tether at $1, despite having multiple alternatives. So, even if it is the case that Tether is insolvent...it was still a much better investment than leaving the money in regular crypto. QED.
      - village-idiot 8y ago
        Markets also valued beanie babies highly for a while. Pretending that markets are purely rational is going to get you hurt. If the case is that Tether is actually insolvent, then history gives us a very good example of exactly what’ll happen once the run starts.
        darawk 8y ago
        > Markets also valued beanie babies highly for a while. Pretending that markets are purely rational is going to get you hurt. My point isn't that the market is rational or perfect. My point is that they could have hedged.
        village-idiot 8y ago
        Almost impossible to do when the markets are rigged. I believe for a while Bitfinex would let you wash trade with your own account, that’s how poorly run these markets were.

darawk 8y ago

> Tether has long been suspected of being a complete and total fraud, a wildcat currency propped up by mere promises, not proof, of backing cash. Those suspicions have always been extremely poorly grounded. > Exchanges have also been suspected of manipulating prices to liquidate future positions, there’s literally a twitter account dedicated to force liquidated Bitmex position. Not by anyone serious. Sure, people get liquidated all the time because they don't have enough maintenance margin. The risks are very clearly defined, and all you have to do is read them. > When every player is operating in bad faith it is very hard to come up with a legitimate way to protect yourself other than not participating. There is no evidence that the major exchanges are operating in bad faith. And even if they were, what is your point? My point is that they could have neutralized the currency risk of their assets. And that point is absolutely true.

pgwhalen 8y ago
> Those suspicions have always been extremely poorly grounded. I am really quite ignorant on the issue, but they seem to me like reasonable suspicions when Tether’s purported “audits” are anything but.
- village-idiot 8y ago
  They no longer claim to provide audits.
  - darawk 8y ago
    The fact of the matter is the market continues to value Tether at $1, despite having multiple alternatives. So, even if it is the case that Tether is insolvent...it was still a much better investment than leaving the money in regular crypto. QED.
    - village-idiot 8y ago
      Markets also valued beanie babies highly for a while. Pretending that markets are purely rational is going to get you hurt. If the case is that Tether is actually insolvent, then history gives us a very good example of exactly what’ll happen once the run starts.
      - darawk 8y ago
        > Markets also valued beanie babies highly for a while. Pretending that markets are purely rational is going to get you hurt. My point isn't that the market is rational or perfect. My point is that they could have hedged.
        village-idiot 8y ago
        Almost impossible to do when the markets are rigged. I believe for a while Bitfinex would let you wash trade with your own account, that’s how poorly run these markets were.