> What exactly is hard about running a fiat backed stablecoin? That probably isn't what Tether is doing. They're likely running a crypto-loan backed stablecoi

> What exactly is hard about running a fiat backed stablecoin? That probably isn't what Tether is doing. They're likely running a crypto-loan backed stablecoin pegged to the dollar. A fiat backed stablecoin is a bit useless since it just looks like bank deposits and withdrawals. Lending USDT against crypto collateral is both what they've explicitly stated that they're doing and it makes them look a bit more like a central bank (and the issuance of Tether tends to fuel trading bots that push the price of crypto up which leads to more issuance of Tether in a nice positive-feedback loop in a way that should make any student of supply and demand perfectly happy). They've named their crypto-collateralized loans "Commercial Paper" which has been a huge success and managed to get literally everyone searching and speculating about what kinds of CP they've been buying up in the real world, when the real answer is pretty much none--creating a great distraction.