Topic: Tether - page 2. (Read 680 times)

So is it your contention that investors didn't care that Silk Road got taken down, because it was so small and nobody cared about it?

Or are you suggesting that nobody cared that Bitcoin's image was being cleaned up, including all the illegal activity being FUD'd about in the media? It was irrelevant to the bubble?

At the time, American Congresspeople were demanding a crackdown on Bitcoin and the Silk Road.

It's easy to erase this stuff in hindsight, but Silk Road was a very big deal at the time. You can say it was only 5% of transactions, but that's a big deal, honestly.


Now you're shifting the goal posts. Wasn't your claim that Tether being taken down will cause a bear market?

Well January 15th came and went and bitcoin didn't crash and USDTUSD didn't go to 0. So FUD as usual. Most people didn't even know what the Jan 15th date was about. It was just about submitting documents to the NYAG.

Seems its very easy to create FUD these days. If you looked at the USDTUSD and USDCUSDT pairs yesterday you would see that people were actually selling their Tether in exchange for USDC just in case there was some negative reaction. The %'s difference was very little however.

Then (2012):
https://www.cylab.cmu.edu/_files/pdfs/tech_reports/CMUCyLab12018.pdf


Bitcoin was on its way to a 2nd bull run that year after the previous bubble collapsed a couple months earlier. Seizure of SR may have contributed to the rise in price, but there were other factors:

https://royalsocietypublishing.org/doi/10.1098/rsos.180643#d3e1959
See articles 3.1 & 3.2.


I don't know if the death of Tether alone would have been enough, but it certainly looks like a major impediment...


Banking problems and regulations most exchanges have problems dealing with is the only reason something like Tether came to fruition. It wouldn't have been created if there was no demand for it. If there had been no demand, the price, global interest, etc. would have been so low no one would be thinking about any Bitcoin ETFs.

And there will be always FUD about it. In fact, the more people are planning to use it, the more likely this FUD will be spread.

I remember that, back in 2017's top, one of the most reasonable strategies was to take some profits via Tether. I remember that, this last quarter of the year and first of 2018, the FUD about it being a scam was everywhere (I follow various crypto-journals, and received these kind of news almost every day, and the same happened in crypto-twitter). Because of that, many members I know didn't take profit, because hodling BTCitcoin was more safe, and then came the dump.

Well, most of us know the story. What I want to explain with that is the thesis from the first sentence, and if I'm not wrong, the higher the FOMO, the higher will be the FUD about Tether too, regardless of the real reasons behind that fear, that could be real.

Tether is just a mere part of Bitcoin’s price discovery to 6-digits. Without Tether, I believe it would be something else, simply because Bitcoin is useful to the entities involved, whether to HODL, moving value, scamming, buying heroine, trading profits, so on and so forth.

What are the statistics, now vs. 2013 when Silk Road was taken down? At the time, there weren't that many services and as I recall SR was considered a very important part of the economy.

Narrative wise, I believe the government shutting down Silk Road gave Bitcoin the sort of legitimacy that began getting the attention of serious investors and even hedge funds. It was no longer just a currency for drug traffic. That was the narrative anyway.

Ignoring short term effects, I believe the same dynamic would play out if the ecosystem's shadier elements (like Tether) were shut down. The SEC implied as much in their commentary on why ETFs were rejected in the past.


Not sure I follow, but I don't mean to say there wouldn't be demand for no-KYC secondary markets. I'm just saying the SEC has complained they are an avenue for market manipulation, money laundering, etc. and this is an impediment to an ETF approval.


All I'm saying is, don't be so married to the idea that "Tether going down must cause a bear market." We tend to hyper focus and dwell on these narratives while ignoring more important supply/demand realities like institutional accumulation. Like I said, institutions aren't going to stop accumulating because Tether goes down. The exact opposite would happen. Retail investors might panic sell but smart money will be buying the dip.

As I said earlier, timing is everything. If Tether goes down in a year while BTC is trading at $350K, it'll make the perfect catalyst for a bubble pop and bear market. But that's going to happen anyway, regardless of what happens to Tether.

If Tether went down right now, in the early stages of a bubble, I'm much less confident a bear market would ensue. I think it would look more like the Silk Road crash in October 2013.



You can't seem to accept the possibility that stablecoin value could converge on other alternatives like USDC or BUSD in the wake of Tether going down. You assume it must be some giant apocalypse that will destroy the Bitcoin economy and send it into some huge bear market. Maybe, maybe not, but you haven't exactly made your case.

Stablecoins are convenient for crypto trading,but that's their only purpose.
If Tether dies,there will be another stablecoin taking the place of Tether.Sad,but true...
The rumors about Tether having fractional reserve will continue forever.I don't know why the Tether team hasn't done anything to prove the legitimacy of their stablecoin and provide some solid evidence.
I'm not a Tether fan and definitely not a stablecoin fan.The crypto market will be way better without the stablecoins and most of the smaller altcoins.

Despite all that has been mentioned and all the problems that have been raised about the Tether in the past, it is still the most used currency in most exchanges, there are many stable coins in the market, but the Tether is the most used, there are few exchanges that provide the real dollar pair and therefore most users trade Vs Tether.
Personally, I don't trust Tether, especially after the New York State Attorney's lawsuit against Bitfinex and its affiliate Tether, my money cannot be safe with Tether.

DNM activity always contributed to a very small percentage of total transaction volume and the price was recovering weeks before the arrest.  


If there was no demand for services like BitMEX and Tether (in the current regulatory landscape), it would mean interest in Bitcoin has dropped to levels too low to warrant the creation of an ETF.


Short term, maybe, but medium-long term?

@exstasie. What is damn vague in tether has become a systemic risk on bitcoin because tether has become interdependent with the whole of the cryptospace?

Why should I be biased? I am realist.

You just keep repeating "if Tether goes down, bear market." That's pretty damn vague and I don't buy it, not in the early stages of a bubble. I've pointed out repeatedly with examples how bad news simply cannot stop a bubble. I've been through too many "Silk Road crashes" and "China banned Bitcoins" to take your word for it.

You think institutions give a shit about Tether going down? They'll be ecstatic! You realize what happened when Silk Road was taken down, right? Bitcoin was legitimized and then surged into the October/November 2013 bubble!

If Bitmex and Tether didn't exist, we'd probably have an ETF by now.

On top of that dynamic, the April 2017 experience (when Bitfinex and Tether lost banking capabilities) tells me the "panic buying out of USDT and into crypto" factor will skew the market bullish in spite of the negative sentiment arising from a Tether takedown.


Very open minded to alternative possibilities eh? You don't sound biased at all.

Bears could use the 15th to start a dump. Just for no reason. Spread some fake FUD, drop the price... Like they did many times.

To some extent yest. The biggest exchanges that involve altcoins have always been reporting fake volumes, that's nothing new.

To be clear I also am not denying the effects that Tether's inevitable downfall is going to have on bitcoin price, but I'm saying that the effect Tether has on bitcoin has always been greatly exaggerated. Consequently the downfall and the price crash that would probably follow will mostly be panic sells, something similar to whenever a big exchange gets hacked and people panic sell bitcoin.

@malevolent. Agreed! January 15 will only be a submission and presentation of documents. The NYAG cannot declare their next recommendation before the review. The documents might contain pages of millions of blockchain transactions, I reckon. This might take the NYAG many months of careful review and double checks hehehe.

It's also a necessary evil for many participants in the market when alternatives are lacking, mostly due to various regulations.


Even if that date proves to be prophetic, it will take longer until enough events unfold to affect Tether/Bitfinex/iFinex, and potentially the price of BTC.

You know what this would mean. Tether has become a necessary part of the cryptospace market. Taking down Tether might pop the bubble and might begin a new bear market. There is nothing vague about this. Exactly how like a storybook, I am not certain.

How do I know? Unless we witness the exchanges begin to converge on USDC now then I would not change this bearish speculation.

I am also not hoping for a bear market hehe. I am holding bitcoins and speculating on altcoins like everyone.

Also, I cannot speculate how fast each exchange would recover, however, bitcoin bear markets of the past are minimum 2 years long.



@pooya87. Are you implying there is wash trading? The biggrest exchanges hold the biggest volume of USDT.

Bitcoin is the reason that tether keep on being in the market and relevant so you could be thinking or wishing for what may not be real to take effect. The high level of price is making hodlers hide gains in tether and other stablecoin and that is a big plus. Stable coin IMO is now the major advantage of cryptocurrency. Is like an individual regulation of his bitcoin hodling and takes away the bubble story away.

I'm aware of what the term means. I'm asking what you mean when you apply it to Tether and the Bitcoin market. What would a Tether collapse look like? How exactly would it affect the Bitcoin ecosystem?

You vaguely assert it would crash the BTCUSD price. Why? How?


How do you know? Maybe value would quickly converge on another stablecoin like USDC. The market uses USDT as a hedge and for stability; if it no longer serves that purpose, the market will go elsewhere.

Also, in my experience, no bad news can stop a raging bull market. If Tether goes down during the current bubble (at least during the early stages) I don't think it will cause the crash you''re hoping for.


Binance and other altcoin exchanges would quickly recover. The market would price USDT on secondary markets like Binance based on the prospects of monetary recovery. Bitfinex would probably be affected, yes, because they are an affiliated company with the same owners and directors and they obviously share banking liquidity.

It is not.
Trading volume of bitcoin against USDT is always less than 10% of the total volume. Whenever there is a huge volatility and shitcoin pump and dump like these days, a lot of traders transfer funds between exchanges using Tether which increases its volume.
It is also currently closer to 23% not 50. That is $17,180,972,728 out of $75,276,784,300 if you believe (shit)coinmarketcap.com data which is another issue, the fake volume that altcoin exchanges have always been reporting to stay on top of this table.

@ exstasie. Systemic risk is when a market is open to risks of collapse or instability because of interdependecies within. A collapse of one part of the market where the whole is interdependent, can cause instability or collapse on the whole market.

Similar to what we have been arguing before, USDT’s share of the total volume and liquidity is more than 50% of the whole cryptospace market. Take down USDT, the market will become unstable or begin another bear market.

In any case, this is an old article where I saw this idea of USDT as a systemic risk for the first time.



All investors, institutional or otherwise, have a duty to try to see the world as it truly is. Not as they wish it to be. This is especially true when putting investment dollars at risk. One needs to ask questions to understand elements influencing the outcome of an investment.

One of those questions is: How could things go wrong here?

Investment guru Charlie Munger, for example, says: “Invert, always invert: Turn a situation or problem upside down. Look at it backward. What happens if all our plans go wrong? Where don’t we want to go, and how do you get there?”

There is potential for catastrophic, systemic risk in crypto right now. Recent events surrounding Binance, Bitfinex and the stablecoin Tether necessitate this conversation.

Yet it is strange how infrequently one hears the concept of systemic risk mentioned in this space.

Remarkably, USDT is still the most widely used stablecoin. Traders use it extensively to move into and out of positions on crypto exchanges across the globe.

However, it’s possible USDT could get locked up or otherwise become unusable. There would likely be a cascade of activity following that. This could cause massive, ecosystem-wide harm to the entire crypto space.

Many exchanges (including Binance nd Bitfinex) likely couldn’t function. Assets would likely get locked up in court battles that could take years to resolve. Think Lehman Brothers.

When they fell, the rest of Wall Street felt the pain.

Source https://www.coindesk.com/binance-bitfinex-and-tether-whats-the-worst-that-can-happen