4 ms·

Ray isn't the only one, the market is pricing in zero risk of tether collapsing. It trades at no discount to real dollars, anybody with a Coinbase account could

Ray isn't the only one, the market is pricing in zero risk of tether collapsing. It trades at no discount to real dollars, anybody with a Coinbase account could convert pretty high volumes of tether to real dollars. I really have no idea why, it seems sketchy.

choxi 6y ago
It looks like Coinbase doesn't support Tether: https://www.coinbase.com/price/tether https://www.coinbase.com/price/tether
- itsoktocry 6y ago
  Tether drives the price of Bitcoin (and other cryptocurrencies), which they do support.
- thebean11 6y ago
  Should have specified, you'd need to convert tether to bitcoin on a different exchange, then sell the bitcoin on Coinbase (or any other real-dollar exchange). The point is that 1 dollar buys the exact same amount of bitcoin as 1 tether.
- gruez 6y ago
  but kraken does: https://trade.kraken.com/charts/KRAKEN:USDT-USD https://trade.kraken.com/charts/KRAKEN:USDT-USD
- pjkundert 6y ago
  You are correct; its USDC token is backed by audited USD$.
lalaland1125 6y ago
Tether is almost certainly holding on to a couple billion real dollars to maintain the peg. This is very similar to how the Bank of England maintained an artificial value for the pound that wasn't broken until George Soros came around.
- CyberDildonics 6y ago
  I think it is much more likely that tether is backed by bitcoin and is a ponzi scheme. Price rises seems to be driven heavily by more tether being created out of nothing, leading to another speculation and news frenzy, leading their btc being more valuable and safety from default despite creating more tether. If bitcoin goes down rapidly or people start exchanging lots of tether for bitcoin (because you can't actually get USD from it) I think it will end up exposed, since as btc goes down their backing value goes down.
  - thebean11 6y ago
    > If bitcoin goes down rapidly or people start exchanging lots of tether for bitcoin (because you can't actually get USD from it) I think it will end up exposed To be fair, this already happened. Bitcoin crashed from $22k to $4k, and this was at the height of tether worry.
    - CyberDildonics 6y ago
      That happened over the course of a year and I don't think there was a massive (enough) run on tether while it was low, since it didn't stay at that price for very long. There just isn't as much activity when bitcoin is low which I think also works in tether's favor. I think they do have significant btc backing them, just no USD. I actually wrote a comment about their dynamic two years ago when this happened. https://news.ycombinator.com/item?id=18222578 https://news.ycombinator.com/item?id=18222578
      - thebean11 6y ago
        It crashed from its peak to $6k in 2 months. The bear market lasted a long time, the initial crash was pretty fast when it first happened..
      - kgkyltpgllg 6y ago
        It stayed at $3k for 4 months in 2018.

choxi 6y ago

It looks like Coinbase doesn't support Tether: https://www.coinbase.com/price/tether https://www.coinbase.com/price/tether

itsoktocry 6y ago
Tether drives the price of Bitcoin (and other cryptocurrencies), which they do support.
thebean11 6y ago
Should have specified, you'd need to convert tether to bitcoin on a different exchange, then sell the bitcoin on Coinbase (or any other real-dollar exchange). The point is that 1 dollar buys the exact same amount of bitcoin as 1 tether.
gruez 6y ago
but kraken does: https://trade.kraken.com/charts/KRAKEN:USDT-USD https://trade.kraken.com/charts/KRAKEN:USDT-USD
pjkundert 6y ago
You are correct; its USDC token is backed by audited USD$.

lalaland1125 6y ago

Tether is almost certainly holding on to a couple billion real dollars to maintain the peg. This is very similar to how the Bank of England maintained an artificial value for the pound that wasn't broken until George Soros came around.

CyberDildonics 6y ago
I think it is much more likely that tether is backed by bitcoin and is a ponzi scheme. Price rises seems to be driven heavily by more tether being created out of nothing, leading to another speculation and news frenzy, leading their btc being more valuable and safety from default despite creating more tether. If bitcoin goes down rapidly or people start exchanging lots of tether for bitcoin (because you can't actually get USD from it) I think it will end up exposed, since as btc goes down their backing value goes down.
- thebean11 6y ago
  > If bitcoin goes down rapidly or people start exchanging lots of tether for bitcoin (because you can't actually get USD from it) I think it will end up exposed To be fair, this already happened. Bitcoin crashed from $22k to $4k, and this was at the height of tether worry.
  - CyberDildonics 6y ago
    That happened over the course of a year and I don't think there was a massive (enough) run on tether while it was low, since it didn't stay at that price for very long. There just isn't as much activity when bitcoin is low which I think also works in tether's favor. I think they do have significant btc backing them, just no USD. I actually wrote a comment about their dynamic two years ago when this happened. https://news.ycombinator.com/item?id=18222578 https://news.ycombinator.com/item?id=18222578
    - thebean11 6y ago
      It crashed from its peak to $6k in 2 months. The bear market lasted a long time, the initial crash was pretty fast when it first happened..
    - kgkyltpgllg 6y ago
      It stayed at $3k for 4 months in 2018.