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If Tether untethers there will be a rush to other assets, pushing them higher. Shorts denominated in USDT will get absolutely decimated, pushing other assets h
by dekz 6y ago
If Tether untethers there will be a rush to other assets, pushing them higher.
Shorts denominated in USDT will get absolutely decimated, pushing other assets higher.
Exchanges using Tether will enforce a maximum withdrawal, pushing other assets higher.
Smart money will buy USDT at a discount once their reserve details are made publicly available. If it's FUD they'll make an absolute killing.
There's 3 possibilities here:
1. Tether is completely backed 1:$1 (highly unlikely)
2. Tether is partially backed, the reserves are greater than the outstanding
3. Tether is partially backed, the reserves are less than outstanding
Only 3) will have a downward price correction. If they've been buying BTC like everyone here has suggested then 2) is the most probable, since you know BTC is at yet another ATH.
If it becomes public that tether has excess reserves, the FUD will disappear silently. Worst case Tether says they will slowly sell off to reach 1:$1 over the next 12 months.
- rtpg 6y agoyou own a bunch of tether, you decide to "rush" to other assets. Except your existing assets are dropping to 0, so you don't actually have that much buying power anymore. So you'll only see a fraction of a rise. Meanwhile whoever sold you the tether probably cashed out a while back.
- tehlike 6y agoSomeone will front run the news and sell tethers for btc, or things like that.
- lottin 6y agoNot to mention that people don't rush to other assets in general, they rush to safe assets. No one is gonna rush to buy bitcoin in the event of turmoil affecting bitcoin exchanges, this is just nonsense.
- ac29 6y ago> If Tether untethers there will be a rush to other assets, pushing them higher. On unbanked exchanges this is true. However the next step is that people will transfer those inflated assets to banked exchanges to exchange them for fiat, pushing the price down. See Gox, Mt.
- ad31mar 6y agoYeah, or simply buy Bitcoin and wait it over.
- chalst 6y agoThis argument is very flawed, I'll pick on just one point. The main users of Tether are generally people who find it difficult to use conventional finance, so in the event confidence in USDT collapses, a lot of holders will be unable to exit. I don't know why you gave possibility 1, given Tether have admitted it is not completely backed. Since the operation has refused over many years to provide proper accounts, breaking their own promise that they would, you would be foolish to bet on a rosy picture of their finances.