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What if Tether the company just throws in the towel? Take the reserves and run? What incentive do they have not too?
by runbathtime 5y ago
What if Tether the company just throws in the towel? Take the reserves and run? What incentive do they have not too?
- phpnode 5y agoI don't think there really are any (or many) reserves. I think they just printed a bunch of tokens, used the tokens to buy BTC and to inflate the value of the crypto they hold in Bitfinex (Bitfinex and Tether are approximately the same company). If they throw in the towel they lose their ability to influence the crypto market which is where their actual gains come from.
- bob33212 5y agoThat seems most likely. They thought that it doesn't matter if they back these tethers with BTC because BTC is a better investment than the UDS anyways. Once they went down that path they had no way of getting out other than printing more tether to prop up BTC when BTC dropped.
- realce 5y agoIf we're being totally honest, the incentive not to do so is probably death. Who knows who is "invested" with them, doubtful it's people who like investments with accurate record-keeping.
- graeme 5y agoJail or death. They’re rumoured to be heavily involved with drug cartels for money laundering. But jail is a near certain outcome if they just took the money and ran off. So they’re stuck with it. Once it implodes they’ll also face jail, but they can kick the can down the road.
- ImPostingOnHN 5y agoWith this much money at play, being incarcerated for even a brief period of time can easily end up being a death sentence
- knownjorbist 5y agoCan they even do that? What would that actually look like, from a technical perspective?
- xur17 5y agoThey would just stop redemptions. The existing supply would continue to exist on Ethereum and be tradeable, likely dropping in value due to the decreased confidence in it as an asset.