As for withdrawing, you can’t withdraw to the US any more, but you can still make international USD wires to banks in other jurisdictions, specifically Taiwan and Hong Kong. I have not heard anything contradicting this, and have seen a fair bit confirming it.
One exciting "feature" of all this is that most tickers that price out crypto currency values treat USD and USDT as one and the same. I've yet to see Bitfinex, for example, show up on a ticker as "BTC / USDT" (which is what, in fact, the pairing is).
It worries me because people use these things to inform their "investment" decisions and my hunch is most of the data they use is not quite on the up & up.
Just as when you deposit on any exchange, for example, Kraken, you don't have "USD" per se, you just have "Kraken USD credits" which you can withdraw, subject to their limitations, via wire transfer. Also, when you deposit your USD in Chase Bank, you don't have USD, you have "Chase USD credits" which you can withdraw, subject to their limitations, on demand.
In all cases you are dependent on the solvency of the institution, which is what is in question here. But Bitfinex is correct in not saying that you are buying or selling USDT -- you are trading with USD, regardless of what internal accounting practices they use to ensure that they are solvent.
No, I have USD in my account when I deposit to Chase. I can go to Chase and say "give me my fucking money" and they'll give me sweet cold, hard dirty fiat dollars with, in general, no questions asked. I deposited in dollars, my account balance is denoted in dollars, my withdrawals in dollars. 1 USD == 1 USD.
All of these Bitcoin exchanges.... ...... maybe you can do that but good luck..... maybe?????
Unlike a real bank, your "Bitfinex Credit" is actually backed by USDT, not USD. When you go to Bitfinex and say "Give me my fucking money in USD", they'll laugh and point out that you never had USD, you bought something called tether which is. Tether being, of course, the space-age crypto currency that is pegged to the USD using ...$methods.... and has, according to their marketing website, been subjected to "multiple professional audits" (cough).
So what you see on all these ticker sites is a bunch of USDT that is silently folded into the USD marketcap and pricing models people use to make their decisions. All of it assuming USDT is actually legit. If USDT goes south, it is going to fuck over the entire crypto market because almost everything there is now completely mispriced. Worse, there is allegations that USDT was being used to drive up and maintain the current crypto prices... if that is true, crypto is double-fucked because even the underlying valuations are bullshit.
> Bitfinex, as I understand it, allows withdrawals in USD (modulo the restrictions above).
Show me an average joe retail "investor" who has been able to successfully withdraw USD from Bitfinex. People have been asking for that person to stand up and raise their hand for months. Crickets is all you get in response.
If you look in the Bitfinex subreddit, you’ll see tons of posts complaining about slow withdrawals, but the older posts all say that the situation was resolved. It might be that they’re just oiling the squeaky wheels, but on the whole it looks like things are working, just slow.
You say that “Bitfinex Credit” is backed by USDT, not USD. Why do you think that? And even if they do this as an internal accounting trick, it is only problematic if Bitfinex is insolvent. USDT seems like a red herring here - either Bitfinex has the money to back their customer deposits or they don’t.
The last time they were insolvent they managed to issue funny money to recover, and, inexplicably, kept their position as the market leaders.
The allegations of market manipulation are concerning, but the crux of it is that if Bitfinex is printing unbacked USDT and using them to drive the price up, that simply means that they are insolvent. Because there are essentially no operating credit markets in the cryptocurrency space, the ripple effects of a run on Bitfinex would be limited by that; not to say they’d be nonexistent, but other market centers trade huge volumes now indepently of Bitfinex.
I’ve gotten more than that out of a credit union located in the basement of a grocery store using literally the exact same form that is use to exchange coins for bills and taking less time.
Maybe the assertion is you can’t do it without an irs notice from the bank? Sure but you can easily get the cash.
I've been hit by the insanity of "yes it's your money but you can't have it" from banks before, and it's one of those things you think everyone else must be a borderline criminal and/or exaggerating until it happens to you.
Anecdote isn't entirely useful here. The fact is they can do it, and even with sizable assets I had far fewer avenues of recourse than one may initially think. This made me really rethink banking security in a new sense.
> inexplicably, kept their position as the market leaders.
Only because there is apparently a large segment of people who do not have functioning critical thinking skills. I know HN doesn't like to do politics, but there is a huge overlap, at least in terms of thought process, in the people who support a particular president and those who support bitcoin. Both seem to lack any kind of critical thinking and both dismiss anything negative about their worldview as "FUD". It is pretty amazing human behavior if at least one of the two categories didn't have some very negative real world consequences...
Honestly, both could almost be considered a very large cult.
source?
"About Tether Tokens; General Restrictions: Tether issues and redeems Tether Tokens. Tether Tokens may be used, kept, or exchanged online wherever parties are willing to accept Tether Tokens. Tether Tokens are fully backed by the currency or property used to purchase them at issuance. Tether Tokens are denominated in a range of currencies. For example, if you purchase EURT, your Tethers are fully backed by Euros. If you cause to be issued EURT 100.00, Tether holds €100.00 to back those Tether Tokens. The range of currencies available to denominate Tether Tokens is within the sole control and at the sole and absolute discretion of Tether. Tether Tokens are backed by money, but they are not money themselves. Tether will not issue Tether Tokens for consideration that is other Digital Tokens (for example, bitcoin), and will not redeem Tether Tokens for other Digital Tokens; only money will be accepted upon issuance, and only money will be provided upon redemption.In order to cause Tether Tokens to be issued or redeemed by Tether, you must be a verified customer of Tether. No exceptions will be made to this provision. "
(all typos and spacing are theirs. This change looks very hastily put together and quite sketchy)
It used to say some stuff about how USDT isn't actually redeemable, etc...
They're doing their best to put up a good face here but good luck actually getting them to hand over cash. The thing is blatantly scammy, they obviously don't have $2.3 billion in cash reserves on hand and never did.
Anybody been able to actually withdraw cold, hard fiat dollars from tether or bitfinex? Show of hands please?
.... crickets ....
[1] If you're a green-name who's skimmed up to here and you're about to say "but Kraken", I am not talking about selling Tether to someone else.
So, who is selling BTC for USDT and why? Who is selling so many BTCs for USDT that they have to print 100 million USDT every other week?
I'd really like to understand that (see also my parallel discussion).
that's... unlikely. mainly because if that were true, nobody would want to sell anything at bitfinex, and cryptocurrency prices there would skyrocket. this happened at mtgox when they halted withdraws, BTC prices skyrocketed there.
I haven't seen anybody anywhere claim they've gotten USD out of Bitfinex...
https://www.reddit.com/r/bitfinex/comments/7rbfca/ticket_636...
The thread here is about Bitfinex not writing money, but on the thread a couple of similar issues get resolved. Could be shills or Bitfinex oiling squeaky wheels. I too would love to see someone here on hn post about their experiences, though.
Completely agree. You'd think with the reach of this place, you'd get a couple people who have done it.
My understanding is this isn't the case. My understanding is Bitfinex will take your USD and convert to USDT which you can then use to buy crypto. But it won't take your USDT and turn it back into dollars. In fact, my understanding is the only way to turn USDT back into USD is either directly through Kraken or indirectly through another exchange by going USDT -> BTC (or ETH/DOGE/whatever) -> USD.
Bitfinex lost the ability to bank in USD a while ago, which is how this whole tether business was invented in the first place.