Topic: nrd525 Market Tracker - page 11. (Read 82718 times)

They've warranted serious concern for a long time. I've been thinking for years that they are just one big law enforcement action away from becoming the next BTC-e. I wouldn't be surprised if the indictment's already under seal and the DOJ is just waiting to make their move.

Until Tether and Bitfinex literally have the FBI seal over their domains, the market won't care. We've already been through years of this FUD and the bank wires are still flowing.

I'm not sure what losses the class suit is claiming.  I think they believe that the Tether manipulation has hurt the price of bitcoin, whereas I think it has currently helped.  Though if people start looking deeper into it, instead of just ignoring it as the "same old FUD" - we could go to 1k and then it would really hurt.

What is a good way to distinguish between real bad news and the "same old FUD"?  For instance, it took a while to realize that the stories of China banning bitcoin were more complex than a simple yes or no.  The Chinese have a complex set of rules designed to limit the use of bitcoin, but they tolerate some uses and mining.  It also took time to realize that China banning bitcoin would be largely neutralized by increases in usage in other countries.

On the other hand, the FUD about MtGox ended up being completely real (in that case it was obvious that there was a withdrawal problem from the premium).  As did my doubts about all the early bitcoin stocks on the bitcoin stock exchange (some of these were investing in ponzis so...), and all the lending schemes that turned out to be from scammers or ponzis.  The ponzis were obvious from the rate of return.

It's my opinion that the doubts about Tether have enough of a scientific basis to warrant serious concern.  And as a user of it from 2013 to 2017, the practices of Bitfinex have not always been the most ethical or professional.  But they do fall short of being obvious scammers.

Ooh, we need to hire that team that went after GE (and previously went after Madoff) for faking their profits.  We need foresnic financial accountants!
https://www.cbsnews.com/news/general-electric-accounting-fraud-bigger-than-enron-alleged-by-madoff-whistleblower/

The doubt about ICOs and altcoins is slowly been proven to be true (though it varies on an alt-coin basis with some holding up very well).  Though the SEC hasn't gone after the ICOs as much as I'd expected/hoped.

...

Bearish: Trump could over-react to the move towards impeachment and do something very harmful to the global economy (or he could do something very bullish, though without a majority in Congress it'd be hard to do a tax cut).  Like get further intrenched in a trade war or a military war.  He's been a bit more off the wall than normal on Twitter.

What losses are they claiming? Were these traders shorting the market and they're trying to blame Tether for pumping it back up? Isn't that the often repeated claim, that Tether prints USDT to prop the crypto markets up?


Since the claimants filed in federal court, the verdict must be unanimous. I've always heard the burden of proof is lower in civil cases though.

I don't think they are actually claiming any amount for losses.  The article headline doesn't match the lawsuit (which could be why the price isn't reacting, people haven't actually read the 95 page lawsuit and would discount it as  FUD if you just read the headline).

The class is defined to include everyone who didn't trade on Bitfinex.  Which seems weird, but apparently we users agreed to use arbitration under the terms of service.

Is there any precedent for financial compensation for losses due to speculative bubbles based on fraud?  I don't know of any.  Though there are laws that require that people who profited from ponzis (notably Madoff) pay back their fake "interest".  And there are laws about buying stolen property.  But I'm guessing that nobody had to pay back gains from say the Hunt brothers cornering the silver market.

It seems like this is more likely to lead to criminal charges against Bitfinex than civil charges with a financial reward, and that they'd be brought by the NY Attorney General.  But there is a financial motivation to bring civil charges, and they might be easier to prove (I think you need a majority of the jury, instead of unanimity).

I removed my bids from 7700 to 6100.  Got bids down to 3k.

What constitutes a class member? Seeing as this is based on market manipulation claims, are we all eligible to be class members if we're Bitcoin traders? I'm happy to take a cut of $1.4 trillion.

Something tells me Bitfinex and Tether don't have that kind of money though.

add a few more zeros on, why not!? how can they possibly claim trillions in damages---because of a "market manipulation"? what kind of gorilla math is this?

the law firm obviously isn't privy to the CFTC and DOJ investigations. it seems like they're just going off public information like the university of texas study. despite all the flack tether gets, i'm skeptical about the manipulation claims. this professor found the cited correlations "not statistically significant":

interestingly enough, the market pumped 7%. news is funny like that.

I hope we get some solid answers from this!
https://www.coindesk.com/crypto-traders-lawsuit-claims-bitfinex-tether-cost-market-over-1-trillion


I'm skim reading the lawsuit and it is very bearish.  It is possible that some people may have convinced themselves that 1) Bitcoin is all about bubbles 2) Willybot worked and 3) We could create the largest bubble ever and do so legally using shell corporations / operating outside of the US.  Not sure how anyone can read this report and not think we'd see at least a 10% decline within 24 hours.

if we go back to $3k, the blood won't stop there. too much time has passed for a double bottom. then we'd be looking at crossing the 2013 ATH in the $1000s. that would certainly change the historic bullish paradigm.

more likely IMO, this is either part of a long term sideways consolidation like 2015 or it's a short term dip like august 2016.

The scary scenario is if 14k was a lower high and we go down to 3k (or even just 5k).  If bitcoin stops have bull cycles that hit all-time-highs, then a lot of people are going to leave the market.

I think the community/ecosystem is big enough that we'd sustain 1k, and maybe 3k.  3k might break with enough bearish conditions.

That must be why they're doing this, to inject liquidity into the USDC markets. They aren't paying interest on our USD holdings, so obviously they want us to switch to USDC.


I wonder if they're talking about paying out staking rewards. It's a smart idea. I think they already do that on their custody platform.

It'd be hilarious if Bitfinex starts paying people interest on Tethers =)
https://www.coindesk.com/coinbase-to-pay-users-1-25-interest-on-usdc-stablecoin-holdings

I'm wondering if moving my orders over the to BTC-USDC market is worth it.  It's a lot lower volume, so there'd be more variation, especially during a sudden move.

yeah, sort of like a mini-version of it. the 2018 triangle lasted like 9 months.....this one for 3 months. i wonder if that means the losses won't be quite as severe this time around.

tbh it feels like this thing is just gonna keep crashing though. the fear is real. i'm scared to buy back. usually when i get this feeling it means the bottom isn't far off.

This kind of looks like the start of the dump at 6k that brought us down to 3k.

Bought 0.81 btc at 8960 down to 8160.  Got bids down to 3k.  Not that I'm expecting 3k, but you never know.

I also just realized that when you overcollateralize a loan, you have loans that create your own supply. Why do they need depositors?

Ex. To borrow $100, deposit $200 in collateral.  They can now lend out $200 and get $400 in collateral for that.   Not only that, but they are getting the collateral at 0% interest (or really negative interest, since you are paying interest on the loan!).

The only reason to have depositors if there is an imbalance in the supply/demand for a specific currency.  Notably they are likely to have a shortage of USD and a surplus of cryptos.

Edit: or they might be using half of the collateral as real collateral (that they can liquidate if necessary) and the other half is used to offer additional loans. This is still risky.

If the collateral is held by Bitgo they might have issues liquidating it.  For instance a flash crash could happen in 5-15 minutes, they'd need to wake up someone who had a lot of authority, and then transfer the coins from Bitgo to an exchange.  Bitgo might have them in cold storage (hopefully) - so this could take hours or more!  They might be able to take some short positions until they get access to the Bitgo coins, but if you are talking about $2 billion in holdings - this is going to be very hard to do (and could further aggravate the flash crash / major correction).

Ok, nobody was an exageration. I may occasionally use bitcoin for exchange value as well.  But it's clearly not enough to cause significant transaction fees.

...

I'm doing more thinking/analysis/debate on Celsius Network and BlockFi.

I was wondering how they could loan money out at lower rates that they provide as interest.  Seems very troubling and ponzi like.  However their solution is at semi-honest. They are comingling the funds and lending out your collateral to other users!

This is fine if the risk is uncorrelated.  If the risk is correlated, then you have a problem.  Risk can be correlated due to flash crashes (we've had several examples of flash crashes all the way to zero or $1), bear markets (bitcoin could fall 95% and other altcoins could fall even more), bull markets (people aren't going to replay crypto that goes up 100x or 1000x), global economic conditions (like a recession), bitgo (could get hacked and insurance that protects the colleral could fail or take years to pay out), and other things that I haven't thought of.

You mean as a medium of exchange? I use BTC to pay for goods all the time. In general I think speculation will precede currency usage. People come for the speculation but they stay for the permissionless currency.

Network fees seem to correlate to speculative activity. Speculation is dead right now in this sideways market, so low fees aren't surprising. They will pick up again when the bull run does.

Nobody uses bitcoin for exchange value.  Transaction fees dropping again.  35 cents gets you in the next block.

https://bitcoinfees.info

More evidence that bitcoin is hard to trace. Downside: regulatory risk.
https://www.coindesk.com/cybercriminals-selling-hacked-fiat-money-for-bitcoin-at-10-of-its-value

If they are doing 50% or less Loan To Value (and they say 20% to 50%), that means the loans are only half the size of the borrowed money.  In one way this is the opposite of margin trading on an exchange where you can get a 3:1 Loan to Value ratio (Bitfinex) or more - so presumably less risky.  On the other hand, this means their rates should a be a LOT lower.  For instance, if you have to give them $100 in Bitcoin as collateral to borrow $50 in USD - you are losing the interest rate on the $100 in Bitcoin (6% = $6) and paying say 12% on the USD = so your total cost of borrowing is actually 24%.  This falls to 16% (2*2%+12%) for amounts greater than 10 BTC (as the opportunity cost falls, or 19% if you include the opportunity cost of not lending on Celsius Network)

(Unless they pay interest on your collateral? which i doubt)

https://www.theblockcrypto.com/post/32006/zac-prince-interview