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Why do people use Tether scamcoin over Gemini stablecoin GUSD? It's supposedly backed 1:1 GUSD:USD and has US-regulated books. I get 5-8% interest on it and has

by andirk 4y ago

Why do people use Tether scamcoin over Gemini stablecoin GUSD? It's supposedly backed 1:1 GUSD:USD and has US-regulated books. I get 5-8% interest on it and hasn't had an issue for its handful of years of being issued.

shuckles 4y ago
Do you have to prove your funds are not black money to buy "GUSD"?
- andirk 4y ago
  No idea. I transferred a bunch of coins from Bittrex and Coinbase, sold some for USD for a nice profit, put that USD in to GUSD, and a month ago pulled out last year's interest of ~$1500 USD to buy some beautiful pendant lights, brass faucet, and a mediocre range hood for my new kitchen remodel.
  - shuckles 4y ago
    And what economic activity did the borrower engage in to pay out more than risk-free interest?
    - andirk 4y ago
      No idea but I doubt they were bombing brown people and guarding Arab oil investments for profit, nor were they attempting coups in resource-rich countries. All that happens with my USD savings account.
xur17 4y ago
> I get 5-8% interest on it and hasn't had an issue for its handful of years of being issued. I agree that GUSD is a good, low risk stablecoin choice, but that's only if you directly hold it. If you're depositing it into an interest earning account, note that you're taking on additional lending risk (which I'd highly recommend against right now).
- andirk 4y ago
  Agreed! I do hold it all in my earning account and if borrowers skip town, then I lose. I treat it as a low risk/low reward in my portfolio. Coincidentally, my "earnings" I pulled out recently was almost the exact opposite amount of current inflation so it's like a hedge against inflation.
  - xur17 4y ago
    If you're holding it on Gemini Earn, I highly recommend withdrawing, even if only for the next few months. Gemini Earn deposits into Genesis Trading, and they have admitted to having direct exposure to FTX ($175M [0]). While they can likely weather that loss, I have concerns about other indirect exposure they may have in the coming weeks. I don't think we've seen the end of the FTX story. If I were you, I'd take the money out yesterday, and hold it in either US Treasuries (6 month pays 4.45%), or put it into a liquid money market while this all blows over. The extra couple of percentage points you'll earn does not at all seem worth the elevated risk right now. [0] https://twitter.com/GenesisTrading/status/1590836594382032896 https://twitter.com/GenesisTrading/status/159083659438203289...
digianarchist 4y ago
Probably because it is regulated and has KYC requirements.
nullc 4y ago
> I get 5-8% interest on it You know these 'yield' schemes generate money by investing in ponzis right? There is just a slow countdown until your money vanishes. Gemini, in spite of their frequent comparisons with savings accounts, makes no guarantees that your money won't vanish. I believe previously their yield was through genesis trading --- who just took on huge losses from FTX...
ummonk 4y ago
How can a fully backed coin offer 5-8% interest without being a scam? The math doesn’t work out since you can’t get 5-8% yields from short term treasuries.

by andirk 4y ago

shuckles 4y ago

Do you have to prove your funds are not black money to buy "GUSD"?

andirk 4y ago
No idea. I transferred a bunch of coins from Bittrex and Coinbase, sold some for USD for a nice profit, put that USD in to GUSD, and a month ago pulled out last year's interest of ~$1500 USD to buy some beautiful pendant lights, brass faucet, and a mediocre range hood for my new kitchen remodel.
- shuckles 4y ago
  And what economic activity did the borrower engage in to pay out more than risk-free interest?
  - andirk 4y ago
    No idea but I doubt they were bombing brown people and guarding Arab oil investments for profit, nor were they attempting coups in resource-rich countries. All that happens with my USD savings account.

xur17 4y ago

> I get 5-8% interest on it and hasn't had an issue for its handful of years of being issued. I agree that GUSD is a good, low risk stablecoin choice, but that's only if you directly hold it. If you're depositing it into an interest earning account, note that you're taking on additional lending risk (which I'd highly recommend against right now).

andirk 4y ago
Agreed! I do hold it all in my earning account and if borrowers skip town, then I lose. I treat it as a low risk/low reward in my portfolio. Coincidentally, my "earnings" I pulled out recently was almost the exact opposite amount of current inflation so it's like a hedge against inflation.
- xur17 4y ago
  If you're holding it on Gemini Earn, I highly recommend withdrawing, even if only for the next few months. Gemini Earn deposits into Genesis Trading, and they have admitted to having direct exposure to FTX ($175M [0]). While they can likely weather that loss, I have concerns about other indirect exposure they may have in the coming weeks. I don't think we've seen the end of the FTX story. If I were you, I'd take the money out yesterday, and hold it in either US Treasuries (6 month pays 4.45%), or put it into a liquid money market while this all blows over. The extra couple of percentage points you'll earn does not at all seem worth the elevated risk right now. [0] https://twitter.com/GenesisTrading/status/1590836594382032896 https://twitter.com/GenesisTrading/status/159083659438203289...

digianarchist 4y ago

Probably because it is regulated and has KYC requirements.

nullc 4y ago

> I get 5-8% interest on it You know these 'yield' schemes generate money by investing in ponzis right? There is just a slow countdown until your money vanishes. Gemini, in spite of their frequent comparisons with savings accounts, makes no guarantees that your money won't vanish. I believe previously their yield was through genesis trading --- who just took on huge losses from FTX...

ummonk 4y ago

How can a fully backed coin offer 5-8% interest without being a scam? The math doesn’t work out since you can’t get 5-8% yields from short term treasuries.