Bitcoin price- If Tether (USDT) go down, will it be good for Bitcoin? - page 2.

adaseb

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Quote from: Febo on December 16, 2019, 11:10:20 AM

Quote from: Person610 on December 13, 2019, 09:06:44 PM

If Tether (USDT) go down, will it be good for Bitcoin?

It should be good. So far people day trade. If there would be no stable coins then they would more hold then day trade. Since when selling Bitcoin would have to pay taxes. But. Tether is not the only stable coin. There are plenty and and more and more are coming. Libra soon, .... So when tether goes down will be no changes.

No it would not be good. I don't think tether will collapse but in the off chance that it actually did, then it would be disastrous and even if you hold Bitcoin, your Bitcoin value would most likely decrease anyways because it would turn out that tether ended up being some scam and many people would just get out all together and just invest their money in the stock market.

Libra isn't really going to be a tether competitor, its going to be centralized and who knows if it will actually go live. When they announced it many of the government bodies stopped in and tried to stop it. By the way these meetings go, it could be years before Libra is actually released.

Febo

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Quote from: Person610 on December 13, 2019, 09:06:44 PM

If Tether (USDT) go down, will it be good for Bitcoin?

It should be good. So far people day trade. If there would be no stable coins then they would more hold then day trade. Since when selling Bitcoin would have to pay taxes. But. Tether is not the only stable coin. There are plenty and and more and more are coming. Libra soon, .... So when tether goes down will be no changes.

el kaka22

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For a short term it would be very bad for bitcoin, there would be a lot of people who will lose money and there will be a lot of people who will want to recover that from bitcoin and withdraw their coins and basically be chaotic for a long time. However in the end we will have a more stable (ironically) and decent market after tether is gone. So I say long term having no tether at all would help us out.

After all we are talking about a corrupt company with a corrupt bank in Bahamas who is no longer supporting their currency 1 to 1 backed anymore, it is not helping us at all right now but slowly draining money away from the market via their company, if they are gone the short term could be horrible but the long term recovery would help many people out and the market as well.

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Quote from: Hueristic on December 15, 2019, 05:43:53 PM

Quote from: exstasie on December 15, 2019, 01:50:53 AM

Quote from: Hueristic on December 14, 2019, 11:50:05 PM

I have no clue why people trusted it and it managed to last this long.
People will do anything for convenience and then they cry afterwards for the Nanny state to save them.

They trust it because it's lasted so long. Tether dodges every bullet. After 5 years, betting on them going down almost starts to feel like betting against Bitcoin.

The resilience of the dollar peg also shows that Tether redemptions are consistently flowing. If people panic sell their USDT, arbitrage traders who can redeem USDT just drive the market back towards $1. As a result, this stability gives confidence to the market. After all, as long as USDT stays pegged to $1 no one is losing value.

This is true even when they were printing and pumping they covered the fractional reserve selling the bubble and hired that law form to publicly announce they had full backing. That added alot of legitimacy to a peg that has ZERO transparency.

Even with the NY Attorney General going after them and their millions seized in that polish bank I think they are Teflon.

Who knows, only time will tell

Hueristic

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Quote from: exstasie on December 15, 2019, 01:50:53 AM

Quote from: Hueristic on December 14, 2019, 11:50:05 PM

I have no clue why people trusted it and it managed to last this long.
People will do anything for convenience and then they cry afterwards for the Nanny state to save them.

They trust it because it's lasted so long. Tether dodges every bullet. After 5 years, betting on them going down almost starts to feel like betting against Bitcoin.

The resilience of the dollar peg also shows that Tether redemptions are consistently flowing. If people panic sell their USDT, arbitrage traders who can redeem USDT just drive the market back towards $1. As a result, this stability gives confidence to the market. After all, as long as USDT stays pegged to $1 no one is losing value.

This is true even when they were printing and pumping they covered the fractional reserve selling the bubble and hired that law form to publicly announce they had full backing. That added alot of legitimacy to a peg that has ZERO transparency.

Even with the NY Attorney General going after them and their millions seized in that polish bank I think they are Teflon.

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Quote from: 1Referee on December 15, 2019, 04:48:19 PM

The capital in Tether that's not withdrawn will be pumped back into Bitcoin because no one wants to hold a stablecoin for too long. There is just too much risk attached to holding it.

Risk to holding it and possibly other stable coins.. Traders may retract a little bit from using Tether but if this spread to other stable coins it may be harmful in a way or another to the actual trading system which may affect bitcoin/altcoins after all.. It is indeed hard to predict the damage that could be done but manipulations will make people think twice before joining cryptocurrencies world.

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Quote from: magneto on December 15, 2019, 01:05:31 AM

Perhaps short term we'll see a negative external shock, but in the long run, it barely matters.

I wouldn't say that. It's not easy to get something similar back where the capital remains inside the ecosystem. While fiat is being withdrawn, the outstanding Tethers can't be easily withdrawn because they're held by those not having a connection to Bitfinex. Throughout the whole bear market not much has been printed, but more importantly, not much has actually been withdrawn.

The capital in Tether that's not withdrawn will be pumped back into Bitcoin because no one wants to hold a stablecoin for too long. There is just too much risk attached to holding it.

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Quote from: The Sceptical Chymist on December 15, 2019, 10:27:55 AM

And man, if the US government is giving Tether such a hard time, I very much doubt they're going to let Facebook proceed with Libra. Things are not looking good on that front.

It's mainly just the state of New York that's hassling Tether. In the scheme of things, they are rather impotent. I almost wonder if the NY AG is being used as a smoke screen to generate evidence for the federal government to build its cases.

The CFTC and DOJ did launch investigations into Bitfinex and Tether 1-2 years ago. For all we know they've been closed......or maybe the DOJ already has indictments under seal (like they did with BTC-e) and they are just waiting for the right moment to pounce. It's impossible to know.

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Quote from: The Sceptical Chymist on December 15, 2019, 10:27:55 AM

Quote from: bitmover on December 13, 2019, 09:47:42 PM

However, if tether breaks and it turns out to be not backed up by USD

How would it break? And isn't it always backed by USD? I can't say I completely understand how the backing works, unless it's like how Libra is supposed to be, but it should always be pegged to the dollar. And if that's true, then I'm not even sure how it can go down in value unless the dollar does.

earlier this year, outstanding tethers were only 74% backed by fiat equivalents. that's because bitfinex had a shitload of money seized by law enforcement and tether issued them a loan from customer deposits.

that's what the LEO token sale was all about---making tether solvent again.

USDT fluctuates both above and below $1 for multiple reasons. for example, when there is high demand from chinese traders, it trades at a premium. when there is high supply from tether FUD, it trades at a discount. but since it always returns to $1 we can assume arbitrage is in effect. if no one can get bank wires out of tether like in early 2017, arbitrage is impossible. during those times, USDT should trade at a significant discount.

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Quote from: bitmover on December 13, 2019, 09:47:42 PM

However, if tether breaks and it turns out to be not backed up by USD

How would it break? And isn't it always backed by USD? I can't say I completely understand how the backing works, unless it's like how Libra is supposed to be, but it should always be pegged to the dollar. And if that's true, then I'm not even sure how it can go down in value unless the dollar does. That would actually create an arbitrage opportunity, because you could then buy Tether with dollars and wait until it stabilizes (I'm not an expert in arbitrage, but that's basically what currency traders do).

And man, if the US government is giving Tether such a hard time, I very much doubt they're going to let Facebook proceed with Libra. Things are not looking good on that front.

onyek16M

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Quote from: Person610 on December 13, 2019, 09:06:44 PM

Read an article on another lawsuit on Bitfinex controlled Stable coin Tether (USDT).

https://news.bitcoin.com/bitfinex-and-tether-receive-another-class-action-lawsuit-in-us-courts/

The operators of the cryptocurrency exchange Bitfinex and the stablecoin Tether have notified users that they were hit with another class action lawsuit in U.S. courts over market manipulation allegations that the companies are trying to frame as mercenary and baseless.

Now the question is, if Tether ever go down Will it affect the price of Bitcoin and the whole crypto ecosystem?

previously there is no relationship about USDT go down will affect with bitcoin price but its wrong, an another article show that USDT has relation with bitcoin. Tether used to pump bitcoin and both move together example in juli 2018 cryptocurrency go down at the same time USDT dropped too
then in august 2019 bitcoin pump from $6000 to $7000 of course the USDT also increase price

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I am quite sure bitcoin could handle this situation. Because if USDT were to be gone, people who rely on stable coins probably would dare to try getting shot at bitcoin, at least. Though on the other hand, as USDT act as bridge between crypto and trader/investor, the situation may turn out the least I expect.

Person610

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Quote from: exstasie on December 15, 2019, 01:50:53 AM

Quote from: Hueristic on December 14, 2019, 11:50:05 PM

I have no clue why people trusted it and it managed to last this long.
People will do anything for convenience and then they cry afterwards for the Nanny state to save them.

They trust it because it's lasted so long. Tether dodges every bullet. After 5 years, betting on them going down almost starts to feel like betting against Bitcoin.

The resilience of the dollar peg also shows that Tether redemptions are consistently flowing. If people panic sell their USDT, arbitrage traders who can redeem USDT just drive the market back towards $1. As a result, this stability gives confidence to the market. After all, as long as USDT stays pegged to $1 no one is losing value.

No, bitcoin is owned by no one
And cannot he charged by the govt, whereas tether is

exstasie

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Quote from: Hueristic on December 14, 2019, 11:50:05 PM

I have no clue why people trusted it and it managed to last this long.
People will do anything for convenience and then they cry afterwards for the Nanny state to save them.

They trust it because it's lasted so long. Tether dodges every bullet. After 5 years, betting on them going down almost starts to feel like betting against Bitcoin.

The resilience of the dollar peg also shows that Tether redemptions are consistently flowing. If people panic sell their USDT, arbitrage traders who can redeem USDT just drive the market back towards $1. As a result, this stability gives confidence to the market. After all, as long as USDT stays pegged to $1 no one is losing value.

magneto

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Will it be good? I highly doubt that given the influence that USDT currently has over the market.

However, I think that the detrimental effects that tether going down will have on the wider crypto market is overstated to an extreme degree at this point, because of the fact that USDT simply will not be the fundamentals underlying BTC's growth in the long run.

Perhaps short term we'll see a negative external shock, but in the long run, it barely matters.

Hueristic

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Quote from: exstasie on December 14, 2019, 01:30:10 PM

Quote from: Lucius on December 14, 2019, 10:23:35 AM

The whole situation around USDT for me personally is very non-transparent and pretty much in some gray area. Someone tells you that something is backed by USD, then it is not fully backed, but it is not known with what is backed 26% of USDT...

Before the NYAG exposed the whole thing, Tether had changed their terms to this:

Quote

“Every tether is always 100% backed by our reserves, which include traditional currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by Tether to third parties, which may include affiliated entities.”

In hindsight they were stating pretty clearly that USDT wasn't full backed by cash anymore, that "from time to time" its reserves would include loan receivables.

https://cointelegraph.com/news/cryptocurrency-community-eyes-tether-after-website-dilutes-usd-backing-claims

When it first came out they had a disclaimer that they would not be held responsible to redeem tether for currency.

I have no clue why people trusted it and it managed to last this long.
People will do anything for convenience and then they cry afterwards for the Nanny state to save them.

Dart18

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It will affect it a lot.
There is a positive side and also a negative.
It depends on how it will be done.
Take out Tether with a warning first then people will be buying bitcoin and altcoin which will cause a lot of demand.
Now, without a warning and all those money will be taken out with it. I think you know what will happen.

I do think it is not the right time anymore. We are far too late to take out that huge market that is keeping the traders alive. Grin

Wexnident

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I don't request loans~

I doubt not? Tether isn't even 100% backed by USD, and even if it was, there are a lot of other stable coins out there that could replace it. In the short run, market price may scuffle a bit because of tether going down, but it isn't a damage that can't be repaired by time. Rather, a few months should be enough for traders to adjust to the disappearance of tether and move on and about with their trades just as usual.

If however a lot of changes occur, damages may remain in the long term. Tether going down joined up with several famous coins suddenly having issues and the like.

Person610

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Tether is basically a token backed by your own money.
It’s a a contract like any other, but people buy it for a dollar, with some fees for the tx, it’s basically your own money that backs it. The biggest thing question is will they use people funds to cover there losses if there is any

exstasie

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Quote from: Lucius on December 14, 2019, 10:23:35 AM

The whole situation around USDT for me personally is very non-transparent and pretty much in some gray area. Someone tells you that something is backed by USD, then it is not fully backed, but it is not known with what is backed 26% of USDT...

Before the NYAG exposed the whole thing, Tether had changed their terms to this:

Quote

“Every tether is always 100% backed by our reserves, which include traditional currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by Tether to third parties, which may include affiliated entities.”

In hindsight they were stating pretty clearly that USDT wasn't full backed by cash anymore, that "from time to time" its reserves would include loan receivables.

https://cointelegraph.com/news/cryptocurrency-community-eyes-tether-after-website-dilutes-usd-backing-claims

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