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My reasoning is different. They have repeatedly been forced to admit in court that they lied in the past. They have also had reserves invested with a fake ban
by btilly 4y ago
My reasoning is different.
They have repeatedly been forced to admit in court that they lied in the past. They have also had reserves invested with a fake bank whose CEO stole money from them and is now convicted in bank fraud. They claimed to be one of the largest holders of specific asset classes, but nobody trading those has any memory of trading them. And so on and so forth.
The refusing to allow a real audit is just icing on a cake consisting of a mountain of evidence of fraud.
As Matt Levine memorably said, they are "practically quilted out of red flags."
- bhouston 4y agoIt seems that Tether will survive - why, because they have so far. Not sure why, but I figure they bluffed their way to solvency?
- throw_m239339 4y agoYeah, I found Tether resilience incredible indeed, but Madoff and his Ponzi scheme went on for decades too even when JP Morgan figured out it was a scam and still did business with him while informing neither the SEC nor the US government. https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-and-fbi-assistant-director-charge-announce-filing-criminal https://www.justice.gov/usao-sdny/pr/manhattan-us-attorney-a... So they must be "backed" by something, we just don't know whom or how, that allows them to keep their scheme running.
- Darkphibre 4y agoIs there a way to "short" Teather? Seems like that'd be the money play.
- wmf 4y agoIt's possible but it's extremely dangerous. The exchanges that you'd use to short Tether are the ones preventing Tether from collapsing. These exchanges could invent an excuse to liquidate you before they allow Tether to collapse so even if you were right you'd still lose all your money.
- btilly 4y agoHuh. When Patrick McKenzie aka patio11 decided to try it, he expected to lose his money, but that was not the main risk he listed. https://twitter.com/patio11/status/1580269516331720706 https://twitter.com/patio11/status/1580269516331720706 Still his reason to make that bet was the comedy of being proven right about how broken crypto is when he lost his money. And not for the opportunity to be proven right and make money.
- patio11 4y agoI believe something very similar to the above commenter, with the proviso that it might not be "the exchanges" engaged in market manipulation but rather Tether or a co-conspirator. Tether has printed trades far above a dollar before on various exchanges; the only reason to waste money doing that (as the buyer) is to liquidate shorts. Playing in a rigged casino seems even more -EV than playing in a fair one. But this is not top of mind or hugely relevant to the comedy gold thread.
- sumeno 4y agoEverything survives until it doesn't
- namdnay 4y agoit took 5 years for people to finally open their eyes on wirecard i think? and several years for Madoff too