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When the Bitfinex’d posts came out in 2017, I found them fairly convincing. It seems likely there is something not quite right at Bitfinex and Tether. But I hav

When the Bitfinex’d posts came out in 2017, I found them fairly convincing. It seems likely there is something not quite right at Bitfinex and Tether. But I have yet to see any evidence that the scale of “not right” is so large as is frequently claimed. These critiques never seem to address the most parsimonious explanation for periods of increased Tether issuance, which is that they are driven by genuine demand for bitcoin, and much of that demand is routed via Tether. There is ample evidence of the sketchiness of the people behind Bitfinex. But there is also a simple explanation for the behavior of bitcoin and Tether in 202 that involves no conspiracies. Many hodlers bought during the March crash because they saw it as an opportunity to buy at a discount (I am one of these people). The crash coincided with events that should drive up the price of bitcoin over the longer term. Specifically, the creation of trillions of new dollars and what many saw as a new era of much looser monetary and fiscal policy. The idea that demand for hard currencies is increased is totally consistent with this. Compared to 2017, I now believe there is a smaller chance of total tether insolvency and a larger chance of significant but not catastrophic shenanigans.

PragmaticPulp 6y ago
> These critiques never seem to address the most parsimonious explanation for periods of increased Tether issuance, which is that they are driven by genuine demand for bitcoin, and much of that demand is routed via Tether The bigger question is: Why are so many institutions using Tether to purchase 7-8 figures of bitcoin at a time instead of simply engaging with any of the well-known institutions who will facilitate the purchase directly? What do all of these buyers possibly gain by using an intermediary currency and funneling all of their money through the Tether company first? The only explanation I can come up with is that Tether is being used to skirt financial regulations or launder money, which doesn't bode well for Tether either.
- wskinner 6y ago
  > The only explanation I can come up with is that Tether is being used to skirt financial regulations or launder money, which doesn't bode well for Tether either. This may well be true. But it also seems to be the case that for a long time, Tether was the only game in town, and institutions built integrations around it. Someone starting out now might not build on Tether.
- janaagaard 6y ago
  > The only explanation I can come up with is that Tether is being used to skirt financial regulations or launder money, which doesn't bode well for Tether either. Could it not be possible that cryptocoins has become a massive world wide gambling area? People betting on the prices going up or down, moving their assets between floating cryptos and Tether.

PragmaticPulp 6y ago

> These critiques never seem to address the most parsimonious explanation for periods of increased Tether issuance, which is that they are driven by genuine demand for bitcoin, and much of that demand is routed via Tether The bigger question is: Why are so many institutions using Tether to purchase 7-8 figures of bitcoin at a time instead of simply engaging with any of the well-known institutions who will facilitate the purchase directly? What do all of these buyers possibly gain by using an intermediary currency and funneling all of their money through the Tether company first? The only explanation I can come up with is that Tether is being used to skirt financial regulations or launder money, which doesn't bode well for Tether either.

wskinner 6y ago
> The only explanation I can come up with is that Tether is being used to skirt financial regulations or launder money, which doesn't bode well for Tether either. This may well be true. But it also seems to be the case that for a long time, Tether was the only game in town, and institutions built integrations around it. Someone starting out now might not build on Tether.
janaagaard 6y ago
> The only explanation I can come up with is that Tether is being used to skirt financial regulations or launder money, which doesn't bode well for Tether either. Could it not be possible that cryptocoins has become a massive world wide gambling area? People betting on the prices going up or down, moving their assets between floating cryptos and Tether.