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If you plan to buy Bitcoin please wait a few months until lawsuit against Tether [1] gets a ruling - if they are found guilty of a price manipulation scheme it

by mamon 6y ago

If you plan to buy Bitcoin please wait a few months until lawsuit against Tether [1] gets a ruling - if they are found guilty of a price manipulation scheme it should temporarily bring Bitcoin price down to more reasonable level, say below 1000 USD. [1] https://www.courtlistener.com/recap/gov.uscourts.nysd.524076/gov.uscourts.nysd.524076.110.0.pdf https://www.courtlistener.com/recap/gov.uscourts.nysd.524076...

wan23 6y ago
The market cap of Tether is $21,807,025,291 according to coinmarketcap. Wouldn't the rush to trade all those tokens for something else push up the price of BTC?
- webinvest 6y ago
  They could just swap the Tether for some other stablecoin that tracks the US dollar. There’s quite a few of them now. In that case, nothing happens to the price of Bitcoin.
  - webinvest 6y ago
    USDC, USDJ, DAI, PAX, BUSD, GUSD are 6 alternatives to USDT. There are apparently also half a dozen other USD stable coins.
- mamon 6y ago
  Yes, and that's exactly what's happening right now, that's why Bitcoin price rose from 10k to 32k USD since September. Music is going to stop soon, and people are desperately looking for chairs to sit on.
  - randomopining 6y ago
    Tether's market cap has increased a ton in the past few months. BTC's market cap is like over 600 billion... Huge institutional accounts are taking their coins off exchanges and putting into cold storage. How does that go along with what you're saying?
    - deleted 6y ago
      [deleted]
  - webinvest 6y ago
    In my opinion, that is not why Bitcoin’s price rose last month but I do not wish to share all that I know and give my hand away (for free). Many investment managers, who previously only flirted with cryptocurrencies, have started making rather high price predictions to their followers or investors. Most hold a 1% to 5% of their portfolio in bitcoin or other cryptocurrencies as a hedge but not as a primary bet. If I remember correctly, a 1% position in Bitcoin in 2017 combined with a 99% position in the S&P500 would’ve doubled the performance of a 100% S&P500 portfolio. Something like a 14% return vs a 28% return. (Then in 2018 if you didn’t rebalance your portfolio, it would’ve dropped down quite a bit.)
    - webinvest 6y ago
      Did someone downvoting me because I disagree with you that bitcoin will go down to 1000 USD? Alright, if you’re bearish and you think it will go down, put your money on it! Buy put options, sell bitcoin futures, or short bitcoin. Any of it works. Many cryptocurrency exchanges let you short against a USD stablecoin, many brokerages let you sell futures, and half a dozen brokerages let you buy put options (or sell call options). But don’t put any more money on your bet than you’re willing to lose! Heck I’ll even give you an offer, if you want to let me know what your position is, I’ll take the other side! Put your money where your mouth is.
- qeternity 6y ago
  There is an interesting doomsday arb that I have been toying with (fully believing that USDT is 90% of the alpha in BTC). The trade here is to be long exchanges that are USDT backed and short exchanges that are USD backed. This ultimately leaves you with a net short of USDT vs USD but it's very different than just being short USDTUSD on an exchange because those very exchanges won't be solvent if this unravels. So basically if the world doesn't end, you're mostly hedged (you have have manageable spread risk between the two exchanges) and if it implodes, you should see prices on the USDT exchanges skyrocket as people buy crypto to send elsewhere where they will immediately sell for fiat. The result is that BTCUSDT soars and BTCUSD plummets. Now, you'll never get paid on your BTCUSDT length but you will get paid on the short leg in your legitimate USD exchange At the end of the day there are better ways to make money in life though. But the trader in me will probably put a few quid to work here.
webinvest 6y ago
People have been saying Tether is gonna crash since late 2017 and that FUD directly helped cause the cryptocurrency crash of late 2018. People that would’ve swapped out of crypto into tether swapped out of crypto all together when they lost faith in tether. But look, tether is still around and doing fine. It has held it’s value of $1 for most of the time. People say it might not have it’s full reserve requirement of 100% dollars. But banks in the United States normally operate with a reserve requirement of only 10%. There are also a few different tether replacements available for people to swap into now.
- mamon 6y ago
  >> But banks in the United States normally operate with a reserve requirement of only 10% The banks are legally allowed to do that, Tether wasn't. According to the lawsuit at some point they started declining buying back USDT, due to the lack of real dollars in their bank account. That's clearly a fraud, since they were assuring their customers they have sufficient reserves. Also, the reason they were at some point missing $850M was because that money was seized in various countries as coming from drug cartels. Seems like there's a lot of rope to hang them with.
  - webinvest 6y ago
    There actually isn’t a reserve requirement anymore. That 10% requirement was removed sometime in mid 2020. Frauds that act like a bank or are a bank can last quite a lot longer than most people realize even if their deposits are lent out, collateralized, or lost altogether. You only know who’s swimming naked when the tide rolls out. From what I see, USDT (Tether), is still one of 6 prominent stable coins on Poloniex. Prominent enough to be listed first. If USDT stopped being worth $1 for too long, I’d assume the exchanges would remove it. According to this chart, Tether has done it’s job fine through the ups and downs. https://coinmarketcap.com/currencies/tether/ https://coinmarketcap.com/currencies/tether/
    - mamon 6y ago
      The lawsuit I cited suggests that two exchanges were actually complicit in the scam - and Poloniex is one of them. Also, since Tether has its bank accounts in Deltec bank in Bahamas, the inflow of $15B to such a small country would be visible in country's foreign currency balance sheets. The official report from Bahamas government shows that this balance is currently around $60B and has actually decreased during 2020. So this $15B worth of newly issued Tethers are not actually backed by USD (those money never reached Tether bank account), they were printed out of thin air.
gge 6y ago
Lol. Good luck with that. No evidence that any of this Tether stuff will bring the Bitcoin price down.
- deleted 6y ago
  [deleted]

by mamon 6y ago

wan23 6y ago

The market cap of Tether is $21,807,025,291 according to coinmarketcap. Wouldn't the rush to trade all those tokens for something else push up the price of BTC?

webinvest 6y ago
They could just swap the Tether for some other stablecoin that tracks the US dollar. There’s quite a few of them now. In that case, nothing happens to the price of Bitcoin.
- webinvest 6y ago
  USDC, USDJ, DAI, PAX, BUSD, GUSD are 6 alternatives to USDT. There are apparently also half a dozen other USD stable coins.
mamon 6y ago
Yes, and that's exactly what's happening right now, that's why Bitcoin price rose from 10k to 32k USD since September. Music is going to stop soon, and people are desperately looking for chairs to sit on.
- randomopining 6y ago
  Tether's market cap has increased a ton in the past few months. BTC's market cap is like over 600 billion... Huge institutional accounts are taking their coins off exchanges and putting into cold storage. How does that go along with what you're saying?
  - deleted 6y ago
    [deleted]
- webinvest 6y ago
  In my opinion, that is not why Bitcoin’s price rose last month but I do not wish to share all that I know and give my hand away (for free). Many investment managers, who previously only flirted with cryptocurrencies, have started making rather high price predictions to their followers or investors. Most hold a 1% to 5% of their portfolio in bitcoin or other cryptocurrencies as a hedge but not as a primary bet. If I remember correctly, a 1% position in Bitcoin in 2017 combined with a 99% position in the S&P500 would’ve doubled the performance of a 100% S&P500 portfolio. Something like a 14% return vs a 28% return. (Then in 2018 if you didn’t rebalance your portfolio, it would’ve dropped down quite a bit.)
  - webinvest 6y ago
    Did someone downvoting me because I disagree with you that bitcoin will go down to 1000 USD? Alright, if you’re bearish and you think it will go down, put your money on it! Buy put options, sell bitcoin futures, or short bitcoin. Any of it works. Many cryptocurrency exchanges let you short against a USD stablecoin, many brokerages let you sell futures, and half a dozen brokerages let you buy put options (or sell call options). But don’t put any more money on your bet than you’re willing to lose! Heck I’ll even give you an offer, if you want to let me know what your position is, I’ll take the other side! Put your money where your mouth is.
qeternity 6y ago
There is an interesting doomsday arb that I have been toying with (fully believing that USDT is 90% of the alpha in BTC). The trade here is to be long exchanges that are USDT backed and short exchanges that are USD backed. This ultimately leaves you with a net short of USDT vs USD but it's very different than just being short USDTUSD on an exchange because those very exchanges won't be solvent if this unravels. So basically if the world doesn't end, you're mostly hedged (you have have manageable spread risk between the two exchanges) and if it implodes, you should see prices on the USDT exchanges skyrocket as people buy crypto to send elsewhere where they will immediately sell for fiat. The result is that BTCUSDT soars and BTCUSD plummets. Now, you'll never get paid on your BTCUSDT length but you will get paid on the short leg in your legitimate USD exchange At the end of the day there are better ways to make money in life though. But the trader in me will probably put a few quid to work here.

webinvest 6y ago

People have been saying Tether is gonna crash since late 2017 and that FUD directly helped cause the cryptocurrency crash of late 2018. People that would’ve swapped out of crypto into tether swapped out of crypto all together when they lost faith in tether. But look, tether is still around and doing fine. It has held it’s value of $1 for most of the time. People say it might not have it’s full reserve requirement of 100% dollars. But banks in the United States normally operate with a reserve requirement of only 10%. There are also a few different tether replacements available for people to swap into now.

mamon 6y ago
>> But banks in the United States normally operate with a reserve requirement of only 10% The banks are legally allowed to do that, Tether wasn't. According to the lawsuit at some point they started declining buying back USDT, due to the lack of real dollars in their bank account. That's clearly a fraud, since they were assuring their customers they have sufficient reserves. Also, the reason they were at some point missing $850M was because that money was seized in various countries as coming from drug cartels. Seems like there's a lot of rope to hang them with.
- webinvest 6y ago
  There actually isn’t a reserve requirement anymore. That 10% requirement was removed sometime in mid 2020. Frauds that act like a bank or are a bank can last quite a lot longer than most people realize even if their deposits are lent out, collateralized, or lost altogether. You only know who’s swimming naked when the tide rolls out. From what I see, USDT (Tether), is still one of 6 prominent stable coins on Poloniex. Prominent enough to be listed first. If USDT stopped being worth $1 for too long, I’d assume the exchanges would remove it. According to this chart, Tether has done it’s job fine through the ups and downs. https://coinmarketcap.com/currencies/tether/ https://coinmarketcap.com/currencies/tether/
  - mamon 6y ago
    The lawsuit I cited suggests that two exchanges were actually complicit in the scam - and Poloniex is one of them. Also, since Tether has its bank accounts in Deltec bank in Bahamas, the inflow of $15B to such a small country would be visible in country's foreign currency balance sheets. The official report from Bahamas government shows that this balance is currently around $60B and has actually decreased during 2020. So this $15B worth of newly issued Tethers are not actually backed by USD (those money never reached Tether bank account), they were printed out of thin air.

gge 6y ago

Lol. Good luck with that. No evidence that any of this Tether stuff will bring the Bitcoin price down.

deleted 6y ago
[deleted]