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Tether is obviously not backed 1:1 by USD as previously claimed. Now the dodgy piechart informs us that it is backed mainly by corporate bonds and loans - if tr

Tether is obviously not backed 1:1 by USD as previously claimed. Now the dodgy piechart informs us that it is backed mainly by corporate bonds and loans - if true I would guess mostly to related companies. A recent Bloomberg article says they have been lending Billions to Chinese property companies! Eventually enough of the gullible fools will realise that the Emperor has no clothes, then there will be a run on Tether which will collapse its price, this will also crash the whole crypto market and people will finally realise that a random number (no matter how cleverly generated) is not worth $64k, not even $1k.

rvz 5y ago
Correct. Tether is a giant scam as I and many others have said before: [0] Won't be surprised to see the scam finally unveiled and to cause a seismic crash in the crypto markets. I would start packing my crypto holdings out of the market real soon™... Things are getting quite, unstable and euphoric once again. [0] https://news.ycombinator.com/item?id=27960613 https://news.ycombinator.com/item?id=27960613
- tenuousemphasis 5y ago
  Why would a collapse of tether cause a crash in the crypto markets?
  - jzymbaluk 5y ago
    It could spark a liquidity crisis. Tether is a mechanism for converting crypto to USD, and if there's a run on Tether and they run out of USD for whatever reason, it'll spiral into a run on other exchanges, if people aren't able to change their crypto back into USD, the value of that crypto suddenly vanishes
- jzymbaluk 5y ago
  Part of me is trying to come up with ways I could short this incredibly irrational market™, but I'm reminded of the saying that the markets can stay irrational longer than you can stay solvent
rchaud 5y ago
It won't be that straightforward. Tether is one head of the snake. As scrutiny increases on USDT, volume will simply shift to USDC and other similarly unaudited stablecoins. These can be issued and adopted faster than regulators can file cases against them.

rvz 5y ago

Correct. Tether is a giant scam as I and many others have said before: [0] Won't be surprised to see the scam finally unveiled and to cause a seismic crash in the crypto markets. I would start packing my crypto holdings out of the market real soon™... Things are getting quite, unstable and euphoric once again. [0] https://news.ycombinator.com/item?id=27960613 https://news.ycombinator.com/item?id=27960613

tenuousemphasis 5y ago
Why would a collapse of tether cause a crash in the crypto markets?
- jzymbaluk 5y ago
  It could spark a liquidity crisis. Tether is a mechanism for converting crypto to USD, and if there's a run on Tether and they run out of USD for whatever reason, it'll spiral into a run on other exchanges, if people aren't able to change their crypto back into USD, the value of that crypto suddenly vanishes
jzymbaluk 5y ago
Part of me is trying to come up with ways I could short this incredibly irrational market™, but I'm reminded of the saying that the markets can stay irrational longer than you can stay solvent

rchaud 5y ago

It won't be that straightforward. Tether is one head of the snake. As scrutiny increases on USDT, volume will simply shift to USDC and other similarly unaudited stablecoins. These can be issued and adopted faster than regulators can file cases against them.