3 ms·

Yeah this is all being driven by tether collapsing which is driving up prices on bitfinex and people trying to arbitrage the price difference before bitfinex go

Yeah this is all being driven by tether collapsing which is driving up prices on bitfinex and people trying to arbitrage the price difference before bitfinex goes bankrupt. They’re also printing tether like crazy again.

sixQuarks 8y ago
Not saying you’re wrong, but HN comments were the thing that convinced me not to buy bitcoin at $1
- loceng 8y ago
  Perhaps since you didn't buy you could have a unique perspective. Imagine you bought at $1 and made $10s of millions of dollars - whether from any value or work actually being done, or whether it was just the effect of a global, decentralized Ponzi-Pyramid-like scheme. Imagine you don't sell all of it because, well, now you're set for life - or in a better position than you were before - so you're happy to promote whatever cryptocurrency you hold, in hopes it goes up further in value. Imagine then instead you bought it anywhere from $5000 to its peak $19,000+ value. Imagine how desperate and how incentivized you may be wanting or working towards increasing the positive perception and therefore demand of whatever cryptocurrency. Now imagine this army of "HODLers" that seems to mostly be tied to ideology and greed over there being any seemingly useful consumer use case that's better than non-cryptocurrency alternatives. Then understand that as this army of HODLers grows, they will influence and lobby or inject themselves further into regulatory bodies (regulatory capture) in order to try to force (even subtly) the rest of society to adopt cryptocurrencies, in order to try to legitimize them - however in reality it's in order to transfer wealth an unnecessary and unreasonable amount from late adopters weighted towards the earliest adopters, so they can realize their "gains" - to exit from the Ponzi-Pyramid scheme. Edit: The initial downvotes didn't don't convince me that the pro-Bitcoin et al holders aren't part of a Pyramid-Ponzi scheme, however they were certainly expected to happen in this thread. If you're not familiar with indoctrination - which is belief guided by others with similar bias and blind spots - even Fred Wilson, USV partner - USV who's early investor in Coinbase (etc) acknowledged the problem of ideologies/orthodoxy (yet blind to it himself it seems): https://avc.com/2019/04/orthodoxy/ https://avc.com/2019/04/orthodoxy/ -- Bitcoin/cryptocurrencies is religion with members tied together with a financial incentive.
  - isoprophlex 8y ago
    All the while being driven by the bogosort of financial transaction processing, which injects massive amounts of co2 into the atmosphere. Fuck everything about bitcoin.
    - verroq 8y ago
      You're going to ignore that most of the mining happens in China using excess hydroelectric capacity?
      - loceng 8y ago
        We can keep playing this shallow-deep thinking game: are you trying to say China is using 100% renewable energy everywhere and has no need for lower energy costs for the rest of their population? And surely that energy could be used for other things, except it's not right now because getting paid for mining/processing transactions in a Ponzi-Pyramid scheme is far more profitable than other uses.
        verroq 8y ago
        >are you trying to say China is using 100% renewable energy everywhere and has no need for lower energy costs for the rest of their population? No? I'm saying most of Bitcoin mining is done using renewable energy. Most of which is excess capacity that would have been wasted anyway. >And surely that energy could be used for other things, except it's not right now because getting paid for mining/processing transactions in a Ponzi-Pyramid scheme is far more profitable than other uses. And who are you decide how people spend their energy? How many quants do we pay to burn their brains in coming up with strats to create positive alpha because it's far more profitable than solving whatever "important issue" you care about. If you have an issue with how the free market allocates its resources maybe you're the one that is wrong, because people are paying money to show you that you are wrong.
      - isoprophlex 8y ago
        No. Im staring the facts straight in the face[] and I don't understand the implicit point you are trying to make. Approx. 75% of BTC mining is done with renewables. That leaves a carbon footprint of 207.75 kg / transaction This is so completely beyond fucked. (Older sources on google state 450+ kg/transaction but that's not really truthful given current price points) [] https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption
keymone 8y ago
Tether is $1. If there was some massive sell pressure it would go under parity fast. Printing tether wouldn’t help. So how exactly is it collapsing?
- paulgb 8y ago
  > If there was some massive sell pressure it would go under parity fast. This isn’t necessarily true. Tether could use their reserves to buy up the demand and keep the price stable, all the way up until they run out of reserves (I think it’s uncontroversial that they are not 1:1 backed by USD now, right?)
  - keymone 8y ago
    Right, and for as long as tether is able to buy back usdt for $1 it is incorrect to say tether is collapsing.
wc- 8y ago
Tether has maintained $1, tether redemptions are smooth, bitfinex premium over market has returned to ~0% and was even at a discount during the push up through $7200. There are serious problems ahead for Bitfinex legally, but bitfinex is not leading the price action and is certainly not driving up prices. Source: Work in the space every day at an algo/automated prop trading and market making firm.
paulgb 8y ago
Just to make sure I understand, is this the hypothesis? - People want to exit their position in USDT. - It is easier/faster for them to exit to Bitcoin than to USD (because of their banking situation or KYC issues.) - This increases the demand for Bitcoin and drives the price up.
deleted 8y ago
[deleted]
chvid 8y ago
I really don't understand this. If it was true that there were problems with Tether; there would be a run on the bank. And there would be a point where people were blocked from getting real USD for Tethers. But if I buy 100 USD worth of Tether; then can I go to Tether the company (or something) and exchange it to real USD which would be transferred to my USD bank account? Does it work that way? If not then how does Tether maintain the price of one USD to one USDT?
- jaycroft 8y ago
  Tether has never been convertible back to dollars through Tether directly unless you are dealing with astronomical sums - they make no claim (and maybe never have?) of convertibility on their web site. If the average person with a few thousand dollars of Tether wants to get out, they need to first get that value to an exchange that supports real US Dollars. In order to do that, they likely have to do an intermediate sell to some other widely held and accepted coin or token (Bitcoin, Ethereum, XRP), since most exchanges that seem to deal with Tether do not deal with USD, and vise versa. If there were a run on Tether in particular, one of the effects you might expect to see is prices of the most widely traded coins going up in price on crypto-dominant exchanges, and the price of those same coins going down in exchanges with free (as in low friction) convertibility to cash withdrawals. This particular effect would only be one of many though, so the signal might not even be noticeable above the noise of the markets. You can imagine that Tether being proved to be insolvent or a fraud in enough people's eyes (and also close enough to insolvency to spread panic: fractional reserves with illiquid holdings [at best], insolvencies, and outright Ponzi schemes [at worst] can last far longer than you might expect), would cause a lot of other additional, and probably larger, market movement.

sixQuarks 8y ago

Not saying you’re wrong, but HN comments were the thing that convinced me not to buy bitcoin at $1

loceng 8y ago
Perhaps since you didn't buy you could have a unique perspective. Imagine you bought at $1 and made $10s of millions of dollars - whether from any value or work actually being done, or whether it was just the effect of a global, decentralized Ponzi-Pyramid-like scheme. Imagine you don't sell all of it because, well, now you're set for life - or in a better position than you were before - so you're happy to promote whatever cryptocurrency you hold, in hopes it goes up further in value. Imagine then instead you bought it anywhere from $5000 to its peak $19,000+ value. Imagine how desperate and how incentivized you may be wanting or working towards increasing the positive perception and therefore demand of whatever cryptocurrency. Now imagine this army of "HODLers" that seems to mostly be tied to ideology and greed over there being any seemingly useful consumer use case that's better than non-cryptocurrency alternatives. Then understand that as this army of HODLers grows, they will influence and lobby or inject themselves further into regulatory bodies (regulatory capture) in order to try to force (even subtly) the rest of society to adopt cryptocurrencies, in order to try to legitimize them - however in reality it's in order to transfer wealth an unnecessary and unreasonable amount from late adopters weighted towards the earliest adopters, so they can realize their "gains" - to exit from the Ponzi-Pyramid scheme. Edit: The initial downvotes didn't don't convince me that the pro-Bitcoin et al holders aren't part of a Pyramid-Ponzi scheme, however they were certainly expected to happen in this thread. If you're not familiar with indoctrination - which is belief guided by others with similar bias and blind spots - even Fred Wilson, USV partner - USV who's early investor in Coinbase (etc) acknowledged the problem of ideologies/orthodoxy (yet blind to it himself it seems): https://avc.com/2019/04/orthodoxy/ https://avc.com/2019/04/orthodoxy/ -- Bitcoin/cryptocurrencies is religion with members tied together with a financial incentive.
- isoprophlex 8y ago
  All the while being driven by the bogosort of financial transaction processing, which injects massive amounts of co2 into the atmosphere. Fuck everything about bitcoin.
  - verroq 8y ago
    You're going to ignore that most of the mining happens in China using excess hydroelectric capacity?
    - loceng 8y ago
      We can keep playing this shallow-deep thinking game: are you trying to say China is using 100% renewable energy everywhere and has no need for lower energy costs for the rest of their population? And surely that energy could be used for other things, except it's not right now because getting paid for mining/processing transactions in a Ponzi-Pyramid scheme is far more profitable than other uses.
      - verroq 8y ago
        >are you trying to say China is using 100% renewable energy everywhere and has no need for lower energy costs for the rest of their population? No? I'm saying most of Bitcoin mining is done using renewable energy. Most of which is excess capacity that would have been wasted anyway. >And surely that energy could be used for other things, except it's not right now because getting paid for mining/processing transactions in a Ponzi-Pyramid scheme is far more profitable than other uses. And who are you decide how people spend their energy? How many quants do we pay to burn their brains in coming up with strats to create positive alpha because it's far more profitable than solving whatever "important issue" you care about. If you have an issue with how the free market allocates its resources maybe you're the one that is wrong, because people are paying money to show you that you are wrong.
    - isoprophlex 8y ago
      No. Im staring the facts straight in the face[] and I don't understand the implicit point you are trying to make. Approx. 75% of BTC mining is done with renewables. That leaves a carbon footprint of 207.75 kg / transaction This is so completely beyond fucked. (Older sources on google state 450+ kg/transaction but that's not really truthful given current price points) [] https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption

keymone 8y ago

Tether is $1. If there was some massive sell pressure it would go under parity fast. Printing tether wouldn’t help. So how exactly is it collapsing?

paulgb 8y ago
> If there was some massive sell pressure it would go under parity fast. This isn’t necessarily true. Tether could use their reserves to buy up the demand and keep the price stable, all the way up until they run out of reserves (I think it’s uncontroversial that they are not 1:1 backed by USD now, right?)
- keymone 8y ago
  Right, and for as long as tether is able to buy back usdt for $1 it is incorrect to say tether is collapsing.

wc- 8y ago

Tether has maintained $1, tether redemptions are smooth, bitfinex premium over market has returned to ~0% and was even at a discount during the push up through $7200. There are serious problems ahead for Bitfinex legally, but bitfinex is not leading the price action and is certainly not driving up prices. Source: Work in the space every day at an algo/automated prop trading and market making firm.

paulgb 8y ago

Just to make sure I understand, is this the hypothesis? - People want to exit their position in USDT. - It is easier/faster for them to exit to Bitcoin than to USD (because of their banking situation or KYC issues.) - This increases the demand for Bitcoin and drives the price up.

deleted 8y ago

[deleted]

chvid 8y ago

I really don't understand this. If it was true that there were problems with Tether; there would be a run on the bank. And there would be a point where people were blocked from getting real USD for Tethers. But if I buy 100 USD worth of Tether; then can I go to Tether the company (or something) and exchange it to real USD which would be transferred to my USD bank account? Does it work that way? If not then how does Tether maintain the price of one USD to one USDT?

jaycroft 8y ago
Tether has never been convertible back to dollars through Tether directly unless you are dealing with astronomical sums - they make no claim (and maybe never have?) of convertibility on their web site. If the average person with a few thousand dollars of Tether wants to get out, they need to first get that value to an exchange that supports real US Dollars. In order to do that, they likely have to do an intermediate sell to some other widely held and accepted coin or token (Bitcoin, Ethereum, XRP), since most exchanges that seem to deal with Tether do not deal with USD, and vise versa. If there were a run on Tether in particular, one of the effects you might expect to see is prices of the most widely traded coins going up in price on crypto-dominant exchanges, and the price of those same coins going down in exchanges with free (as in low friction) convertibility to cash withdrawals. This particular effect would only be one of many though, so the signal might not even be noticeable above the noise of the markets. You can imagine that Tether being proved to be insolvent or a fraud in enough people's eyes (and also close enough to insolvency to spread panic: fractional reserves with illiquid holdings [at best], insolvencies, and outright Ponzi schemes [at worst] can last far longer than you might expect), would cause a lot of other additional, and probably larger, market movement.