Topic: Bitfinex ‘Official Doc’ Confirms Plans to Raise up to $1 Billion in IEO for... - page 2. (Read 784 times)

I don't think their word has changed. If you are going to assume their word is worth nothing, there isn't much of a point even discussing their situation.

The NYAG did not explicitly say this, but it appears they verified tether had $1 in cash-like securities prior to giving the loan to Bitfinex for every USDT outstanding. I believe this because the NYAG is very anti-business, and would have pointed it out if there were not cash like reserves.
I don't think "cash like assets" would include bitcoin in their definition, nor do I believe they are holding anything like bitcoin as part of their reserves.

The claim the USDT was backed 1-to-1 with USD was not a lie. The claim was changed to its current form at the time they made the loan.

If you have a bank account with $100 in it, your deposit is exactly as you describe.

If you have a bank account with a billion dollars in it, your bank will almost certainly make you wait seven days (they may delay further) to process a wire withdrawal of a billion dollars. A bank deposit is not backed 1-to-1 with cash by the bank, and will need time to liquidate cash if a customer is making a very large withdrawal.

I speculate most of the other stablecoins invest most of their money in short term US government debt securities verses a bank deposit.

I would stay out of Bitfinex, no matter how attractive their IEO is. Until they conduct a full professional audit of their funds, I would advise the other users to do the same. Rumors are going around that they lost $850 million in trading. Now what makes matters worse is that the money they used for trading was not theirs. It came from the accounts of their users. I have seen the response from Bitfinex, but it is a bit vague and a lot of questions remains to be answered.

I find his wording puzzling. "The major part has been raised directly from iFinex. But SPVs and our investors helped in gathering investment from their communities. " Is it just his bad English? He can't possibly mean an insolvent company provided the majority of the funding, can he?

I think he must mean the majority was raised by iFinex. Right?

https://twitter.com/paoloardoino/status/1127839301218254851

They've already pulled it off according to them. It says the majority came from Ifinex - https://twitter.com/paoloardoino/status/1127856906981261317  which I don't get as Ifinex is, um, them but whatever.

Truly they exist in a parallel universe. I don't care how profitable they are, I wouldn't put my lunch money in.

It boggles my mind that people consider outstanding loans to be a form of backing. You no longer have access to these funds. All you are left with is a contractual agreement that the loan will be paid back with x percentage of interest. If every Tether holder will be looking to cash out right now, they can't.

If you can't at any time of the day let every holder of Tether cash out to actual USD, you are just a scam. Coinbase and Circle aren't doing anything with the USD's that back their USDC stablecoin. It's right there sitting in their bank account(s), where they at any time of the day can cover every single withdrawal request to USD. This is how it should be.

You have no proof of that, because they have never submitted to an independent audit. You only have their ever changing word to go on, which is worth nothing.

But again, Tether isn't a bank. They widely and very specifically claimed that USDT was backed up 1-to-1 with USD, which they've now admitted was a blatant lie. "Cash like assets" means nothing, since they include other cryptocurrencies in that definition. If they print a hundred million Tether out of thin air and use it to buy Bitcoin, they can claim that Tether is backed up with "cash like assets".

There is no shortfall in tether. Tether owns in excess of $1 of assets for every tether outstanding.

Until tether extended a line of credit to Bitfinex, each tether was backed 1-to-1 with cash like assets. Once tether extended the LOC to bitfinex, each tether was backed 1-to-1 with reserves, but only a portion was cash-like assets.

Your bank account is also backed 1-to-1 with reserves, a small percentage of which is cash like assets, and the majority of which is made up of loans made to various customers.

Exactly, they didn't even cover it and blatantly admitted that they just wanted to raise funds for their Tether debacle. Maybe they think that they can still get away and investors will just pour their money, because they are talking about billions of dollars here. 

@BitHodler - there's a lot of gullible people who still jump on everything when they hear this kind of news. Not reading between the lines, all they see is $$$$ ka-ching, but later on bitch around this community because they have lost so much money, how ironic.

With the current situation and hot water Bitfinex has plunged itself in, I don't think someone in their right mind would willing partake in their IEO. The issues with Tether even up to this day just gives out more and more insights and 'leaks' of its true nature which then lowers the trust of people to the said token, and now this? If anything, I would distance myself away from such things, and quite possibly convert my Tether into something else, for good.

First they claimed Tether was backed up 1-to-1 with USD. Then the quietly changed it to backed up 1-to-1 with a variety of unnamed assets, including other cryptocurrencies (meaning they can print Tether from thin air, use it to buy bitcoin, and claim the Tether is fully backed up). Then they changed it to backed up 1-to-0.74 with these unnamed assets. Now they launch a new IEO which they admit is to cover the $850 million shortfall in Tether.

Yes, but Tether isn't a bank. They stated, quite clearly, that Tether was backed up 1-to-1 with USD reserves. We know now that was a blatant lie.

Where did tether admit they are insolvent?

Tether has liquid assets to cover appropriately 74% of tethers and less liquid assets to cover more than the balance.

It is more common for banks to hold liquid assets totaling closer to 10% of deposits.

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It seems as if Bitfinex is going to sell the entire billion dollars worth of coins privately.

https://www.coindesk.com/bitfinex-token-sale-has-lined-up-1-billion-in-commitments-shareholder-says

Its utterly baffling, but not unique to Tether by any means. People were pointing out that Bitconnect was a blatant scam for months before it imploded, and yet the price kept climbing. Half the coins in the top 10 are complete scams, and yet they remain in the top 10.

I suppose what is unique about Tether is that they have openly admitted they are insolvent. Most scams deny it up until the day they run off with everyone's money.

Bitfinex's gang doesn't give a shit about anything, and why would they? People time on time again allow themselves to be abused by these con artists.

Once the situation around Tether cools down and people somewhat forget about it, the Bitfinex gang will figure out another way to steal from people.

The weird aspect to all this drama is that Tether actually becomes stronger with how nothing of what they are subjected to is able to get it to implode. I have never seen people be more willing to lose money than here in the crypto space. What a bunch of retards do we have here. Not cool at all.

I am doubting if Bitfinex can be successful on this project of getting as much as $1Billion in exchange for its LEO tokens. The problem with Bitfinex is lack of transparency and investors are always wary of any entity especially in the world of cryptocurrency which do not value honesty and openness. We should not allow an exchange which seems to have the propensity of doing anything it wants without regards to the responsibility they have on their users and other stakeholders. Bitfinex should start showing to the world that it has nothing to hide and that it is complying with the laws of the land...not doing any shenanigan.

Hahaha, what!? After I read the headline I was going to joke about the fact that this is probably just to raise funds because Tether is currently insolvent, but they openly admit it? Wow. Who in their right mind would invest in a token which is openly being launched to cover their 850 million dollar debt from their previous token?

After the endless list of shady activity surrounding Tether, and now this, it's looking more and more like Bitfinex is just a scam.

People here have proven to not be smart. I have been warning against exchanges like Bitfinex for a long time now and it all seems to be a wasted effort. People somehow want to lose money....

If you think logically (which is difficult for a lot of people here), this exchange and everything related to it isn't even worth a billion, so why should they be able to raise such an amount just to cover some of their debt?

It makes zero sense at all from a logical perspective. It makes a lot of sense for the operators behind Bitfinex because they can expect one of the best paydays ever without much effort.

As per the article:


LOL, are you willing to invest in that IEO? Very sketchy and I think they know what's coming to them, to need to have a plan B to cover up. So if you are a smart investor, you should know that this is just garbage and this doc is more of hyping it.

The first thing coming to my mind while reading the paragraph was "LOL, good way to catch fresh money". Could it be an efficient way for them to back up the supposed debt Tether/Bitfinex? Fees cost nothing for an exchange pov. so they won't lose a lot and it gives a direct capital.
With what's going on, you'd have to be crazy to be involved with finex.

For me it's strange to "leak" this kind of information intentionally. Maybe it's a FOMO situation, so people can feel safer and nothing more?

And they already have their token, tether.

This token crazy is bad for bitcoin in my opinion.... Why would they need 1 billion to launch a token? Unless it's something like tether, which need to be backed up, that's far too much money, more than necessary