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No access to banking is not the same thing as not having the reserves. If there was this massive shortfall/scam that you are alleging, those press releases woul

No access to banking is not the same thing as not having the reserves. If there was this massive shortfall/scam that you are alleging, those press releases would have spared no details in describing them. >>> As found in the order, Tether held sufficient fiat reserves in its accounts to back USDT tether tokens in circulation for only 27.6% of the days in a 26-month sample time period from 2016 through 2018. You're leaving out critically important context, which is that Tether held other assets as reserves: >>The order further finds that Tether failed to disclose that it included unsecured receivables and non-fiat assets in its reserves Reading your comment without this context would lead a casual observer to conclude that the assets backing the issued USDT held a value of 27.6% of the USDT's face value, which is entirely different than reserves equalling ~100% of USDT in value, but with a significant fraction of assets constituting those reserves not being of zero-risk fiat as the marketing arguably implied.

arcticbull 4y ago
I'm not sure why you're quibbling. At one point Bitfinex reached in and took out hundreds of millions of dollars from the reserves Tether had to cover the money they had lost to Crypto Capital Corp. At the time they had a market cap of about $2B, so that was ~25% of reserves wired out. [4, S. III pages 6-9]. That's just one example. There is, and I can't stress this enough, literally no reason for you or anyone else to trust these people. They've never published audits, one of their auditors (Friedman LLP) literally walked away once they saw their books. Then for some of the attestations, they literally wired money in the same day from Bitfinex, then wired it out the next to make it look like they had the reserves. > If there was this massive shortfall/scam that you are alleging, those press releases would have spared no details in describing them. They did. [1] Also, it was covered in the NYAG settlement and the CFTC settlement I linked. I strongly suggest you give them an actual read-through. The entirety of the section III of the PDF covers it in painstaking detail. > Reading your comment without this context would lead a casual observer to conclude that the assets backing the issued USDT held a value of 27.6% of the USDT's face value, which is entirely different than reserves equalling ~100% of USDT in value, but with a significant fraction of assets constituting those reserves not being of zero-risk fiat as the marketing arguably implied. Not only is that is than an obvious misreading of the comment, it wasn't my comment, it was a direct quote from the CFTC website - but then you go on to claim something I never claimed. Let me be clear then: 1. There periods they were physically unable to fulfill demands because they had no bank account access [4]. 2. At other times, their peer organization raided the kitty and literally took the money (because the same executives gave almost a billion dollars to a company indicted for laundering money for - among others - the Colombian cartels, without a contract, and whose execs are in prison or on trial). [2,3] 3. At other times, they invested in illiquid securities and got rekt (they invested in Celsius for instance). Stop giving these people a lick of credit, stop apologizing for them, and demand some proof. [1] https://www.coindesk.com/markets/2019/04/25/bitfinex-covered-850-million-loss-using-tether-funds-ny-prosecutors-allege/ https://www.coindesk.com/markets/2019/04/25/bitfinex-covered... [2] https://www.coindesk.com/markets/2019/10/25/polish-police-arrest-head-of-payment-processor-tied-to-bitfinex-crypto-exchange/ https://www.coindesk.com/markets/2019/10/25/polish-police-ar... [3] https://www.coindesk.com/business/2022/04/25/reggie-fowler-pleads-guilty-in-crypto-capital-corp-case-tied-to-bitfinexs-missing-millions/ https://www.coindesk.com/business/2022/04/25/reggie-fowler-p... [4] https://ag.ny.gov/sites/default/files/2021.02.17_-_settlement_agreement_-_execution_version.b-t_signed-c2_oag_signed.pdf https://ag.ny.gov/sites/default/files/2021.02.17_-_settlemen...
- ETH_start 4y ago
  By "your comment", I'm not referring to the excerpt you quoted from the report. I'm talking about your comment as a whole, which includes the quote about only 27.6% of reserves being fiat, but doesn't include the portion that indicates the shortfall was covered by other assets. And like I said from the beginning: >>It's entirely fair to say there is no basis for trusting the company behind Tether, and by extension Tether. It's unfounded FUD to definitively claim that it's a scam. I will concede that some of the evidence you provided shows a company behaving suspiciously, and at times dishonestly, but this impression one gets from the Tether critics, that USDT is a total scam backed by nothing looks like baseless FUD at the moment, no matter how valid your claims that the company behind Tether shouldn't be trusted.
  - arcticbull 4y ago
    I concede that they have something in their reserves and that some people, at Tether, Inc. discretion, will be able to create and redeem Tether. I can't say without an actual honest-to-goodness audit that they are backed fully. But hey if they come up with one I'll be the first to eat my hat.
    - ETH_start 4y ago
      >>I can't say without an actual honest-to-goodness audit that they are backed fully. That's a fair assessment.
arcticbull 4y ago
> ... reserves not being of zero-risk fiat as the marketing arguably implied. Not arguably implied. Literally and directly stated. Their website at the time said: "every tether is always backed 1-to-1, by traditional currency held in our reserves. So 1 USDT is always equivalent to 1 USD." The lie detector test determined that was a lie. Please I'm begging you, I'd love you to reply to this but only after you read the entire NYAG settlement PDF I linked you. It is actually something of a crime thriller so I promise you'll enjoy it.

arcticbull 4y ago

I'm not sure why you're quibbling. At one point Bitfinex reached in and took out hundreds of millions of dollars from the reserves Tether had to cover the money they had lost to Crypto Capital Corp. At the time they had a market cap of about $2B, so that was ~25% of reserves wired out. [4, S. III pages 6-9]. That's just one example. There is, and I can't stress this enough, literally no reason for you or anyone else to trust these people. They've never published audits, one of their auditors (Friedman LLP) literally walked away once they saw their books. Then for some of the attestations, they literally wired money in the same day from Bitfinex, then wired it out the next to make it look like they had the reserves. > If there was this massive shortfall/scam that you are alleging, those press releases would have spared no details in describing them. They did. [1] Also, it was covered in the NYAG settlement and the CFTC settlement I linked. I strongly suggest you give them an actual read-through. The entirety of the section III of the PDF covers it in painstaking detail. > Reading your comment without this context would lead a casual observer to conclude that the assets backing the issued USDT held a value of 27.6% of the USDT's face value, which is entirely different than reserves equalling ~100% of USDT in value, but with a significant fraction of assets constituting those reserves not being of zero-risk fiat as the marketing arguably implied. Not only is that is than an obvious misreading of the comment, it wasn't my comment, it was a direct quote from the CFTC website - but then you go on to claim something I never claimed. Let me be clear then: 1. There periods they were physically unable to fulfill demands because they had no bank account access [4]. 2. At other times, their peer organization raided the kitty and literally took the money (because the same executives gave almost a billion dollars to a company indicted for laundering money for - among others - the Colombian cartels, without a contract, and whose execs are in prison or on trial). [2,3] 3. At other times, they invested in illiquid securities and got rekt (they invested in Celsius for instance). Stop giving these people a lick of credit, stop apologizing for them, and demand some proof. [1] https://www.coindesk.com/markets/2019/04/25/bitfinex-covered-850-million-loss-using-tether-funds-ny-prosecutors-allege/ https://www.coindesk.com/markets/2019/04/25/bitfinex-covered... [2] https://www.coindesk.com/markets/2019/10/25/polish-police-arrest-head-of-payment-processor-tied-to-bitfinex-crypto-exchange/ https://www.coindesk.com/markets/2019/10/25/polish-police-ar... [3] https://www.coindesk.com/business/2022/04/25/reggie-fowler-pleads-guilty-in-crypto-capital-corp-case-tied-to-bitfinexs-missing-millions/ https://www.coindesk.com/business/2022/04/25/reggie-fowler-p... [4] https://ag.ny.gov/sites/default/files/2021.02.17_-_settlement_agreement_-_execution_version.b-t_signed-c2_oag_signed.pdf https://ag.ny.gov/sites/default/files/2021.02.17_-_settlemen...

ETH_start 4y ago
By "your comment", I'm not referring to the excerpt you quoted from the report. I'm talking about your comment as a whole, which includes the quote about only 27.6% of reserves being fiat, but doesn't include the portion that indicates the shortfall was covered by other assets. And like I said from the beginning: >>It's entirely fair to say there is no basis for trusting the company behind Tether, and by extension Tether. It's unfounded FUD to definitively claim that it's a scam. I will concede that some of the evidence you provided shows a company behaving suspiciously, and at times dishonestly, but this impression one gets from the Tether critics, that USDT is a total scam backed by nothing looks like baseless FUD at the moment, no matter how valid your claims that the company behind Tether shouldn't be trusted.
- arcticbull 4y ago
  I concede that they have something in their reserves and that some people, at Tether, Inc. discretion, will be able to create and redeem Tether. I can't say without an actual honest-to-goodness audit that they are backed fully. But hey if they come up with one I'll be the first to eat my hat.
  - ETH_start 4y ago
    >>I can't say without an actual honest-to-goodness audit that they are backed fully. That's a fair assessment.

arcticbull 4y ago

> ... reserves not being of zero-risk fiat as the marketing arguably implied. Not arguably implied. Literally and directly stated. Their website at the time said: "every tether is always backed 1-to-1, by traditional currency held in our reserves. So 1 USDT is always equivalent to 1 USD." The lie detector test determined that was a lie. Please I'm begging you, I'd love you to reply to this but only after you read the entire NYAG settlement PDF I linked you. It is actually something of a crime thriller so I promise you'll enjoy it.