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> But the Justice Department investigation is focused on conduct that occurred years ago, when Tether was in its more nascent stages. Specifically, federal pros

by graeme 5y ago

> But the Justice Department investigation is focused on conduct that occurred years ago, when Tether was in its more nascent stages. Specifically, federal prosecutors are scrutinizing whether Tether concealed from banks that transactions were linked to crypto, said three people with direct knowledge of the matter who asked not to be named because the probe is confidential. Notably this is for events some time ago. Investigators haven’t gotten far enough ahead to formally file anything relating to the events of March 2020 to present, when Tether added ~$60 billion in tokens and claimed to be one of the largest commercial paper holders in the world. (No one in the commercial paper sector has heard of them) To be clear, by saying it is from some time ago I am not dismissing it. This is extremely serious for Tether.

nipponese 5y ago
How did you survey the commercial paper sector?
- Clewza313 5y ago
  This has been widely reported, see eg Matt Levine's recent take: https://www.bloomberg.com/opinion/articles/2021-07-22/private-equity-firm-got-rich-making-private-equity-firms-rich https://www.bloomberg.com/opinion/articles/2021-07-22/privat...
  - deleted 5y ago
    [deleted]
  - perl4ever 5y ago
    This is great: "“Given our portfolio composition in commercial paper, we believe that it is quite important to respect the privacy of the banking partners that we work with.” That’s not a thing! That’s not a thing at all! Every money-market fund just lists all of its holdings, by size and issuer and CUSIP! Tether has broken new ground in the concept of commercial-paper privacy rights!" ... "Tether has traded between $0.9996 and $1.0009 over the last seven days, including during yesterday’s interview. That’s a pretty tight range given that, you know, anyone can watch the interview."
- deleted 5y ago
  [deleted]
gammarator 5y ago
This thread speculates that Tether’s commercial paper may be in Chinese real estate, which is currently suffering huge losses… https://twitter.com/TheLastBearSta1/status/1418302465557110785 https://twitter.com/TheLastBearSta1/status/14183024655571107...
- spookthesunset 5y ago
  Or more likely tether isn’t backed by anything at all. The auditor they hired quit before completing their audit. Seems legit to me. These dudes are a complete scam but as long as BTC goes to the moon nobody seems to care.
  - deleted 5y ago
    [deleted]
  - fksadfji12 5y ago
    lol
  - spywaregorilla 5y ago
    Given that you're not allowed to redeem tether for dollars I never quite understood why it mattered. edit: Note the difference between "trade" for dollars and "redeem" for dollars
    - graeme 5y ago
      The whales can redeem, in minimum chunks of $100,000. Mostly these are exchanges. Thus the peg is supported by the reserves in a roundabout way. If Tether can’t redeem, and trades break the peg, then ultimately either exchanges go insolves or anyone holding tether has to write off their holdings. Or both.
      - BLanen 5y ago
        > The whales can redeem Show me the burns.
duxup 5y ago
I wonder if this is a situation where there is reason to be concerned about this given event, but it's also an easy path for an investigation to proceed / check if it has happened even further? Pull this stunt once, maybe twice, more?
graeme 5y ago
Update. Tether has replied here. This site is down, but this tweet has it: https://mobile.twitter.com/bitcoinsguide/status/1419694235268362245 https://mobile.twitter.com/bitcoinsguide/status/141969423526... URL for if their site comes back online: https://tether.to/tether-responds-to-bloomberg-article/ https://tether.to/tether-responds-to-bloomberg-article/
- deleted 5y ago
  [deleted]
- ceejayoz 5y ago
  "Open dialogue with law enforcement agencies" is a pretty funny way of describing that relationship.
  - arcticbull 5y ago
    Yes I've had similar such dialogues with law enforcement when caught speeding.
arcticbull 5y ago
IMO this feels more like they know they can get them on these crimes, easily, without involving other countries. Lying to banks is pretty trivial to nail them to the wall for. "Hey I'm a real estate company" - "sir these look like crypto deposits?" - "no, I don't think so." That kind of thing. It's like getting Capone on tax evasion. Once they've got them behind bars they can start untangling the clusterf*ck. Thing is untangling the clusterf*ck is likely a multinational, mutli-party, multi-year effort but lying to Wells should be cut and dried. Remember it took 17 countries cooperating to unwind Liberty Reserve and that was a fraction of the scale and audacity. This will allow them to end it the fastest way possible.

by graeme 5y ago

nipponese 5y ago

How did you survey the commercial paper sector?

Clewza313 5y ago
This has been widely reported, see eg Matt Levine's recent take: https://www.bloomberg.com/opinion/articles/2021-07-22/private-equity-firm-got-rich-making-private-equity-firms-rich https://www.bloomberg.com/opinion/articles/2021-07-22/privat...
- deleted 5y ago
  [deleted]
- perl4ever 5y ago
  This is great: "“Given our portfolio composition in commercial paper, we believe that it is quite important to respect the privacy of the banking partners that we work with.” That’s not a thing! That’s not a thing at all! Every money-market fund just lists all of its holdings, by size and issuer and CUSIP! Tether has broken new ground in the concept of commercial-paper privacy rights!" ... "Tether has traded between $0.9996 and $1.0009 over the last seven days, including during yesterday’s interview. That’s a pretty tight range given that, you know, anyone can watch the interview."
deleted 5y ago
[deleted]

gammarator 5y ago

This thread speculates that Tether’s commercial paper may be in Chinese real estate, which is currently suffering huge losses… https://twitter.com/TheLastBearSta1/status/1418302465557110785 https://twitter.com/TheLastBearSta1/status/14183024655571107...

spookthesunset 5y ago
Or more likely tether isn’t backed by anything at all. The auditor they hired quit before completing their audit. Seems legit to me. These dudes are a complete scam but as long as BTC goes to the moon nobody seems to care.
- deleted 5y ago
  [deleted]
- fksadfji12 5y ago
  lol
- spywaregorilla 5y ago
  Given that you're not allowed to redeem tether for dollars I never quite understood why it mattered. edit: Note the difference between "trade" for dollars and "redeem" for dollars
  - graeme 5y ago
    The whales can redeem, in minimum chunks of $100,000. Mostly these are exchanges. Thus the peg is supported by the reserves in a roundabout way. If Tether can’t redeem, and trades break the peg, then ultimately either exchanges go insolves or anyone holding tether has to write off their holdings. Or both.
    - BLanen 5y ago
      > The whales can redeem Show me the burns.

duxup 5y ago

I wonder if this is a situation where there is reason to be concerned about this given event, but it's also an easy path for an investigation to proceed / check if it has happened even further? Pull this stunt once, maybe twice, more?

graeme 5y ago

Update. Tether has replied here. This site is down, but this tweet has it: https://mobile.twitter.com/bitcoinsguide/status/1419694235268362245 https://mobile.twitter.com/bitcoinsguide/status/141969423526... URL for if their site comes back online: https://tether.to/tether-responds-to-bloomberg-article/ https://tether.to/tether-responds-to-bloomberg-article/

deleted 5y ago
[deleted]
ceejayoz 5y ago
"Open dialogue with law enforcement agencies" is a pretty funny way of describing that relationship.
- arcticbull 5y ago
  Yes I've had similar such dialogues with law enforcement when caught speeding.

arcticbull 5y ago

IMO this feels more like they know they can get them on these crimes, easily, without involving other countries. Lying to banks is pretty trivial to nail them to the wall for. "Hey I'm a real estate company" - "sir these look like crypto deposits?" - "no, I don't think so." That kind of thing. It's like getting Capone on tax evasion. Once they've got them behind bars they can start untangling the clusterf*ck. Thing is untangling the clusterf*ck is likely a multinational, mutli-party, multi-year effort but lying to Wells should be cut and dried. Remember it took 17 countries cooperating to unwind Liberty Reserve and that was a fraction of the scale and audacity. This will allow them to end it the fastest way possible.