3 ms·
you can't make a profit like that. banks (and tether) make profit by miniting news tickets out of thin air, lending the newly minted tickets at a certain rate,
by hathym 4y ago
you can't make a profit like that. banks (and tether) make profit by miniting news tickets out of thin air, lending the newly minted tickets at a certain rate, once the credit is reimbursed they usually destroy the minted tickets and keep the profit.
- zmgsabst 4y agoThat’s one approach to profit, called “fractional reserve”. Typically, people who want a 1-1 backed coin are uncomfortable with that model… so you instead take profit on the issuance: you charge $1.05 to issue $1 in tokens (while keeping $1 in the vault) — a process called seigniorage. https://en.wikipedia.org/wiki/Seigniorage https://en.wikipedia.org/wiki/Seigniorage
- im3w1l 4y ago$1 buys one tether. One tether redeems for $0.999. Then there's also interest on T-bills and stuff.