Is Tether Supply a driver of Bitcoin Prices

adaseb

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Quote from: BitHodler on July 09, 2019, 06:53:47 PM

Quote from: el kaka22 on July 09, 2019, 11:02:19 AM

Now, thanks to tether you do not need to remove your money from the exchange for it to be a fiat, you can keep it on usdt and makes going back into bitcoin so much easier, which probably helped out a bit. I dislike tether but I can't deny its help.

It is definitely helping when it comes to keeping capital inside the crypto market, but that's not entirely because of people not seeing a reason to withdraw fiat, but more so that they can't withdraw.

The only way to withdraw fiat is to sell your USDT to Tether/Bitfinex. If you take into consideration that most holders of USDT are likely not those who injected it in the ecosystem, you'll see why they can't withdraw fiat.

I totally wouldn't feel comfortable sitting in USDT for a long period of time. I get its utility in being an easy to move fiat alternative for traders and investors, but the aftertaste is horribly sour.

Pretty sure that 99% of people or at least all the small retail traders don't send their Tether to Tether.io and do a withdraw into their bank account.

Most people send their Tether to an exchange, buy BTC, and send that BTC to an exchange where they sell for fiat like Gemini or Coinbase.

The fees add up taking these steps but I am pretty sure most don't care since BTC did 300% gain this year, so an extra 1% in trading fees doesn't bother most people.

BitHodler

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Quote from: el kaka22 on July 09, 2019, 11:02:19 AM

Now, thanks to tether you do not need to remove your money from the exchange for it to be a fiat, you can keep it on usdt and makes going back into bitcoin so much easier, which probably helped out a bit. I dislike tether but I can't deny its help.

It is definitely helping when it comes to keeping capital inside the crypto market, but that's not entirely because of people not seeing a reason to withdraw fiat, but more so that they can't withdraw.

The only way to withdraw fiat is to sell your USDT to Tether/Bitfinex. If you take into consideration that most holders of USDT are likely not those who injected it in the ecosystem, you'll see why they can't withdraw fiat.

I totally wouldn't feel comfortable sitting in USDT for a long period of time. I get its utility in being an easy to move fiat alternative for traders and investors, but the aftertaste is horribly sour.

exstasie

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Quote from: benjamin07 on July 08, 2019, 11:49:12 PM

Quote from: Febo on July 03, 2019, 03:18:49 PM

Tether supply = fiat money that was invested in crypto. How on earth would that not influence price of Bitcoin?

do you really deep down believe Tether is not a hoax?

I don't think it is. Tether is very shady and has probably been breaking various laws for years but they aren't a scam or a hoax. Looking through the NY v IFINEX/BFXNA proceedings, it seems obvious that Tether and Bitfinex move many millions of dollars on behalf of trading firms.

Quote from: Pursuer on July 09, 2019, 10:06:55 AM

no it is not "driver" of bitcoin price because to be that you are basically suggesting that Bitfinex has been printing USDT and buying bitcoin with it themselves!

Maybe not themselves per se. Here are some interesting tidbits worth pondering:
https://twitter.com/BennettTomlin/status/1148424564826943489
https://twitter.com/BennettTomlin/status/1148413875118858240

el kaka22

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I think it is not a driver of bitcoin but it kind of has something amazing that helps bitcoin prices that nobody talks about. Now think about what we did for fiat currency back when tether didn't exist? Some people used exchanges to keep fiat currency on their exchanges, some people withdraw completely to their banks, some even cashed out via ATM or localbitcoin ways as well.

It means before tether was a thing there was plenty of people that actually got out of bitcoin completely and that created an issue of going back in and some didn't went back in because they spent the money as well. Now, thanks to tether you do not need to remove your money from the exchange for it to be a fiat, you can keep it on usdt and makes going back into bitcoin so much easier, which probably helped out a bit. I dislike tether but I can't deny its help.

Pursuer

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Where is my ring of blades...

no it is not "driver" of bitcoin price because to be that you are basically suggesting that Bitfinex has been printing USDT and buying bitcoin with it themselves! the problem with that logic is that there is going to be no profit in doing something like that for their company unless they dump bitcoin for fiat and it has been years (7 or 8 years?) that tether has been around and we have not seen anything like that.
you can't just have a half cooked theory either. you have to come out and say it, if you think bitcoin price is manipulated on this scale then you must also explain why it has not been dumped for 10 years and still continues rising?

Febo

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Quote from: benjamin07 on July 08, 2019, 11:49:12 PM

Quote from: Febo on July 03, 2019, 03:18:49 PM

Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Is Tether Supply a driver of Bitcoin Prices

Tether supply = fiat money that was invested in crypto. How on earth would that not influence price of Bitcoin? When tether supply will start decreasing and fiat will start going back out of crypto price of Bitcoin will start reducing. Of course tether is not only way that fiat enters crypto other exchanges then Bitfinex just simply takes it and charge your account, not telling whole world as Bitfinex does who much fiat you gave them.

Febo: do you really deep down believe Tether is not a hoax?

Do you deep down inside you believe that Bitstamp, Kraken and Coibase actually received all fiat that was deposited by people on their exchange? Most likely they make all that up and are crediting people for free, just so those people can buy Bitcoin and inflate its price. Tax they pay for that is just a tiny price for all the profit they get from their hoarded piles of Bitcoin. Without that price of Bitcoin would be probably less then a dollar. You really believe them?

timerland

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

I certainly don't see a strong correlation between the two at all - even though it has been argued by many others that there is.

I wouldn't discount the possibility that printing Tether out of thin air is contributing to certain rallies either, though. But that's not the main underlying reason of these bull and bear markets, in my opinion, because that would still be attributed to the natural market cycles that imminently occur.

Think about it - even if Tether's supply increased during the bear market, where sentiment is extremely bearish, would it really have an impact and all of a sudden reverse the long term trends completely? No. The main driver of that is people's expectations given the halving, how prices consolidated at $3k for a significant amount of time, as well as institutional interest.

To answer your other question, I do think that a tether crackdown will detrimentally effect BTC prices in the short run due to trader's reliance on it as a fiat replacement on exchanges. But in the long run, I doubt it'll hinder its growth.

adaseb

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Quote from: buwaytress on July 06, 2019, 12:55:26 PM

Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Very old news/discussion/point. And quite pointless to me, really. If Tether supply drives Bitcoin prices, then will Tether desupply tear down Bitcoin prices? I doubt it. If something were to happen to Tether one day, something really bad, catastrophic, USDT stuck in some bad smart contract, the issuer gone rogue, Bitfinex liquidated, etc... people would just move to some other stablecoin. Gemini, Coinbase, BNB, will all be waiting in the wings to take over business... and then we'll realise Tether really wasn't that big of a deal to Bitcoin.

Its not as simple as that. I don't think anything catastrophic will happen with Tether since Tether and Bitfinex are making crazy money, doesn't make sense for them to scam.

However if Tether say did fail for some reason, it would create a domino effect. Why? Because most of the liquidity in alts and BTC on some exchanges isn't against BTC or Fiat, its against Tether. So if Tether was worth zero all those alts would affect the cash and futures markets. It would create a huge negative effect on anything crypto related. So even if you don't hold tether, your net worth in crypto would still go down since BTC and alts would be worth alot less.

benjamin07

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Quote from: Febo on July 03, 2019, 03:18:49 PM

Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Is Tether Supply a driver of Bitcoin Prices

Tether supply = fiat money that was invested in crypto. How on earth would that not influence price of Bitcoin? When tether supply will start decreasing and fiat will start going back out of crypto price of Bitcoin will start reducing. Of course tether is not only way that fiat enters crypto other exchanges then Bitfinex just simply takes it and charge your account, not telling whole world as Bitfinex does who much fiat you gave them.

Febo: do you really deep down believe Tether is not a hoax?

buwaytress

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Very old news/discussion/point. And quite pointless to me, really. If Tether supply drives Bitcoin prices, then will Tether desupply tear down Bitcoin prices? I doubt it. If something were to happen to Tether one day, something really bad, catastrophic, USDT stuck in some bad smart contract, the issuer gone rogue, Bitfinex liquidated, etc... people would just move to some other stablecoin. Gemini, Coinbase, BNB, will all be waiting in the wings to take over business... and then we'll realise Tether really wasn't that big of a deal to Bitcoin.

Reid

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

What will happen to bitcoin in a sudden breakdown of Tether?
It will be a yummy month or maybe a year.

Where do you think this Tether holders will go when they speculate that it is near breakdown?
If it is a sudden and they cannot go out, then it will be a sad day for them.
But when they heal all of those losses. What crypto currency do you think they will trust afterwards? Yeah bitcoin it is.

It will happen though. I am sure of that.

davis196

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

I've heard this theory back in 2017 and it might be partially true,but I don't believe that Tether has that much influence over bitcoin.The tether supply goes up because all the cryptocurrency prices are going up as well.
More people are trading coins,thus more people are using tether.

jseverson

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

They got hit with quite a big regulatory mess just before the bull run started:

https://fortune.com/2019/04/25/bitfinex-tether-bitcoin/

That didn't affect Bitcoin prices much, if at all. That doesn't necessarily mean there's no connection though, and I think Tether completely crumbling down would affect the market quite significantly, whether or not there's manipulation behind the scenes.

Quote from: benjamin07 on July 02, 2019, 10:27:28 PM

Only idiots buy and sell BTC/USDT or USDT/BTC, anyone with half the brain of a chicken would not be trading that binary.

As much as I agree, it can't be helped on most non-fiat exchanges. That's their claim to fame in the first place.

mersal

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Probably the supply of tether increases when people cashout their profits of crypto currencies into a stable one which doesn't mean that they are driving the prices.

Febo

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Is Tether Supply a driver of Bitcoin Prices

Tether supply = fiat money that was invested in crypto. How on earth would that not influence price of Bitcoin? When tether supply will start decreasing and fiat will start going back out of crypto price of Bitcoin will start reducing. Of course tether is not only way that fiat enters crypto other exchanges then Bitfinex just simply takes it and charge your account, not telling whole world as Bitfinex does who much fiat you gave them.

figmentofmyass

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Quote from: leowonderful on July 03, 2019, 04:11:46 AM

We don't always pump or move significantly when Tether's printed, but there are times when a large printing of Tether precedes a large move up in price for BTC.

so i'm not the only one who noticed. Cool

there's no doubt the bitfinex and tether markets (like binance) have a strong effect on the market. whenever we see a strong bullish reversal, i go and check the tether printer. often times, it's been on. i'm not necessarily saying they are printing it out of thin air but one has to wonder sometimes!

Naida_BR

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Quote from: criptoUSDJPYEU on July 02, 2019, 03:56:40 PM

Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

Tether is not reliable in making speculation.
This is why there are many more other stablecoins created. The supply of tether is not correlated with the Bitcoin price move. However, If a crackdown happens I am interested to see if those fund will be moved to another stablecoin or will be converted into BTC.

benjamin07

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Quote from: adaseb on July 03, 2019, 12:32:52 AM

Think of it this way.

Say the price of Bitcoin is $1000 a coin and you want to sell it for Tether. Your supply of tether would be $1000.

Now say the price of Bitcoin is $10000 a coin and you want to sell it for Tether. Your supply of tether would be $10000.

So you can see why the supply of tether increases in rising markets, its because it needs to increase so enough people who want to sell bitcoin can do so.

Usually when there is a tether print, its bullish for the markets. Usually traders see this and close their shorts because it usually means that alot of fiat entered the market which bought tether and will eventually buy some Cryptos.

That's a great explanation, thank you. However I am very wary of USDT.

leowonderful

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Bitcoin FTW!

There's even a Twitter account that tracks the amount of Tether and other stablecoins printed and larger transfers of various alts and Bitcoin. The link to the account is as follows, and this account tweets out pretty rapidly after any major transfers make it into the mempools of many blockchains out there AFAIK. https://twitter.com/whale_alert?lang=en

We don't always pump or move significantly when Tether's printed, but there are times when a large printing of Tether precedes a large move up in price for BTC.

YuginKadoya

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I don't really think that tether is behind every movement of bitcoin I really think this is just a coincidence that they see that Tether has moved the value of bitcoin but the truth is Bitcoin is really moving rapidly now because of the bull run movement, And not thanks to Tethers involvement Because Tether is a stable coin, It is backed up by USD and not come from bitcoin itself and I don't think that stable as a cryptocurrency.

arpon11

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Quote from: ?? on ??

Not really, a big dump of tether into bitcoin was a speculation of what started this bull run due to the news on Tether not being completely backed or partially backed and some backing being of securities.

I think it is a coincidence that some people are saying that the dumps of tether at bitfinex was the reason why bitcoin is getting pump at this moment. We also heard some people saying that libla coins was reason why bitcoin get bullish but I disagree with all this views. We have be in this market for long and we know how it operate, we have one event that keep repeating itself pre bullish price and that is halving. I think the market is reacting to the next year halving of bitcoin. The more it becomes very difficult to get bitcoin through mining the better it is in terms of pricing. Tether has little to do with Bitcoin from market capitalization point of view.

adaseb

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Think of it this way.

Say the price of Bitcoin is $1000 a coin and you want to sell it for Tether. Your supply of tether would be $1000.

Now say the price of Bitcoin is $10000 a coin and you want to sell it for Tether. Your supply of tether would be $10000.

So you can see why the supply of tether increases in rising markets, its because it needs to increase so enough people who want to sell bitcoin can do so.

Usually when there is a tether print, its bullish for the markets. Usually traders see this and close their shorts because it usually means that alot of fiat entered the market which bought tether and will eventually buy some Cryptos.

pooya87

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first explain to me why bitcoin price continued falling down for more than a year in 2018 and that was a big drop of nearly 85% while Tether was still around and it was still printing more and more coins and entering it in circulation.
then i will answer your question!

benjamin07

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Only idiots buy and sell BTC/USDT or USDT/BTC, anyone with half the brain of a chicken would not be trading that binary.

batang_bitcoin

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You have to close the other thread you've made on Economics. This post. As forum regulations doesn't allow to create same topic on different sections unless you've translated it to your local language.

Quote from: mprep on July 21, 2014, 12:27:51 PM

12. No duplicate posting in multiple boards (except for re-posting it in the local language boards if it's translated).

Please be guided by that rule, lock the other topic you've made that I've pointed out.

mobnepal

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Tether has been hacked before https://www.coindesk.com/tether-claims-30-million-stable-token-stolen-attacker
and what they got as solution is

Quote

Representatives from the Omni Core software project said they would seek to release new software in the coming days that will allow Tether to retrieve the stolen tokens.

Tether is actually centralized so they can easily manipulate their supply and even with the help of omni (which acts as token creation platform on top of bitcoin blockchain) they can blacklist/block the stolen tokens from being used. So when it will be hacked like this again than it might not have much effect on market.

The major concern is whether all the tether token that exist have backing or not, third party audit will clear this but still many have concerns over their shady financial activities and their involvement with bitfinex. If they go insolvent or proved to have fractional reserve than it might cause chaos in crypto market.

However, With increasing number of new stablecoin like DAI, TUSD, USDC market might not remain totally relied on USDT in future.

criptoUSDJPYEU

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Been seeing so many different articles on this. Charts show a strong correlation in supply of tether with rise in BTC prices. Is Tether supply and trading a significant driver of Bitcoin prices in 2019 up from $3k level in Dec 2018? If so, how much really [estimates with precision]? And what happens to Bitcoin prices if there's a Tether crackdown or if some other really bad news about Tether hits the newswires?

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