I actually posted this in the Alt-coins discussions, but I realized it is better here..
( https://bitcointalksearch.org/topic/why-one-should-short-tether-2890088 )
A. As any trader of any sort can easily explain, taking a position is estimating a potential profit vs the risk of a potential loss.
B. Tether is in turmoil (I won't make any guess on the economical health of Tether nor have an opinion about it, it may be perfectly running or it may be crap, not my concern).
C. The markets are quoting Tether circa 1usd, in other words you can take positions at 1USDT=1USD (1.015 this morning, 0.987 as i am writing the post).
D. In case all goes, the reserves are here and tangible, the legal process stops etc: The loss will be close to 0, since market is max-reversing at 1 usd.
E. In case anything doesn't go well, the market will drop at least to the tangible reserves maximum and/or to the valuation counting the legal risk and availability risk due to a SEC tutelary provision.
Therefor:
if you go short, you may: lose nothing nearly nothing or make a lot.
If you go long, you may: Lose a lot or make nearly nothing.
If one imagines a Nash game out of it, it is obvious the price will go down, at which price you should still go short is another question that I am not able to answer, anyway, go short now.
Topic: Why should one short Tether (simple economics) (Read 109 times)
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