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Why do you think it would tank the equity market?

• PKop 5y ago
  It's all tied together. If one asset class is crashing people sell others to grab cash. Another way, according to Janet Yellen, that Tether and other stables can destabalize markets, is that they have large portions of reserves in corporate debt, a crisis in these coins would cause a fire sale of billions of corporate debt they hold, itself probably cascading into all risk markets.
  • bduerst 5y ago
    Crypto markets maybe, but not main indexes. Experienced financial players smell tether for the scam it is and don't touch it, or I'd they do, they're in on the grift. Laymen who bought the hype stand to lose a lot though.
    • Breza 5y ago
      My understanding is that Tether has bought a bunch of bonds and other financial instruments. If they need to raise cash, they would sell those instruments for whatever price they could get. That could lower the prices, which could have negative effects.
      • bduerst 5y ago
        Tether keeps moving the buck. First it was all USD backing, then when pressed, they said they actually have it all in bonds/securities, which is just as nebulous and doesn't make it any more authenticated. It's not verified by third parties at all, and they're printing non-stop, which is why many people can spot it for the scam it is.
  • paulpan 5y ago
    +1 and my thought exactly. Spillover effect could be fairly significant given that more investors now hold crypto.