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Shorting tether can simply be a hedge against falling tether if you are holding large amounts. Doing that with stocks is completely normal and nothing to raise
by throwaway294566 4y ago
Shorting tether can simply be a hedge against falling tether if you are holding large amounts. Doing that with stocks is completely normal and nothing to raise an eyebrow about.
- edf13 4y agoI'd say it's more of an issue that they are still trading when potentially insolvent
- wizeman 4y agoOut of curiosity, why is shorting better in that situation rather than just selling part of what you're already holding? I mean, why is being long $100k USDT and short $50k USDT at the same time better than just being long $50k USDT? I don't have trading experience so this is not very intuitive to me. Edit: oh, I think I get it. So if you were short $SOMETHING/$USDT then you're effectively long $USDT so if $USDT falls/crashes (i.e. loses its peg) even though $SOMETHING remains equally as valuable (as measured in other currencies), then you could lose a lot of money even though the underlying value of $SOMETHING hasn't really changed. So you could short $USDT/$USD to mitigate $USDT crashing when you're only interested in shorting $SOMETHING. I guess that makes sense?
- jgalt212 4y agosometimes you do this to delay tax events.