4 ms·
It could also be an issue if a large number of people try to redeem a large amount of Tether for USD. Ideally, it would be easy and high trust to go from Tethe
by albntomat0 5y ago
It could also be an issue if a large number of people try to redeem a large amount of Tether for USD.
Ideally, it would be easy and high trust to go from Tether to USD and back. This requires high confidence that the various backings of Tether are low risk, which we cannot establish given the minimal information Tether has provided.
- tiku 5y agoOnly thing is that you don't ever deal with Tether directly, the exchange needs to have that amount of USD for USDT. Same goes for BTC etc. Later the exchange needs to get USD from Tether if they need liquidity in FIAT?
- qeternity 5y ago> It could also be an issue if a large number of people try to redeem a large amount of Tether for USD. Not possible. Tether's terms of service explicitly state they have no obligation to redeem. Tethers only hold value so long as other people believe they do...which is the definition of a fiat currency.
- albntomat0 5y ago> Not possible. Tether's terms of service explicitly state they have no obligation to redeem. Which also leads to a scenario where no one wants to hold Tether > Tethers only hold value so long as other people believe they do...which is the definition of a fiat currency. True, but there's an incredible difference in kind between Tether and the Euro/USD/etc