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Good points about trading that's disabled. I just wonder what is the same and different about cryptocurrencies like Tether's. > They simply drop out of circula

• nostrademons 3y ago
  The difference with Tether is that its value is ostensibly pegged to the dollar, with each Tether being backed 1:1 with real dollar reserves. So its price doesn't float with supply & demand. Instead, for each Tether that is "locked", it's one less person who has a claim on Tether Ltd's bank reserves. It's debatable whether Tethers are actually backed by dollars 1:1; people have long suspected that Tether Ltd mints them out of thin air based simply on promises (i.e. fraud). And occasionally the price has dropped below $1 as suspicions grow and folks try to exit Tether. So it's good for the company to have Tether holder accounts locked, as it means they have fewer liabilities and less chance of a bank run.