Tether says its cryptocurrency is worth $2B–but its audit failed

Re:Tether says its cryptocurrency is worth $2B–but its audit... by sanxiyn on Monday February 05, 2018 @10:11AM (#16309198)

Nobody seems to discuss this, so I want to mention it here: for the first time in history, Tether was revoked in January 31st. Amount was 30 million.

http://omniexplorer.info/lookuptx.aspx?txid=24db40680654b8b5...

Specifically, its transaction type is 56. https://github.com/OmniLayer/spec#field-transaction-type

I don't think this is a strong evidence, but if Tether is issued out of thin air, it is somewhat strange to make revocation. Does someone have a good explanation?

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Re:Tether says its cryptocurrency is worth $2B–but its audit... by random_rr on Monday February 05, 2018 @10:15AM (#16309225)

Keeping pace with the market. Tether burning coins is an expected and healthy part of their supply management strategy. Think about how you'd keep a finite-supply coin pegged to a value - you'd print and burn tokens as needed to stabilize the value of the coin.

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Re:Tether says its cryptocurrency is worth $2B–but its audit... by citricsquid on Monday February 05, 2018 @10:24AM (#16309288)

This is not what Tether is intended to be. Tether is not pegged to the value of 1 USD. The value of Tether does not need to be stabilized. Tether is a 1 for 1 USD backed coin, meaning it's entirely within the scope of Tether for the value of 1USDT to reach $1.10, $1.20 or even $1.50 -- if the market decides that is the value of it.

The point of Tether is that for each USDT there is a corresponding USD in an account belonging to Tether. If Tether were printing USDT to keep 1 USDT valued at 1 USD then they would be violating what Tether is publicly stated to be.

The whitepaper can be found here: https://tether.to/wp-content/uploads/2016/06/TetherWhitePape...

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Re:Tether says its cryptocurrency is worth $2B–but its audit... by jellicle on Monday February 05, 2018 @11:17AM (#16309717)

But if you can buy a new Tetherbuck straight from Tether for $1USD, issued in unlimited amounts, why and how could the value of a Tetherbuck ever exceed $1USD?

And on the flip side, if Tether redeems any Tetherbuck for $1USD, on demand and quickly and without solvency concerns, why and how could the value of a Tetherbuck ever drop below $1USD?

Any deviation from $1USD value means the market disbelieves one of the above things.

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Re:Tether says its cryptocurrency is worth $2B–but its audit... by TeMPOraL on Monday February 05, 2018 @11:03AM (#16309599)

I don't think anybody reasonable believes they're actually backed by USD at this point.

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Re:Tether says its cryptocurrency is worth $2B–but its audit... by sanxiyn on Monday February 05, 2018 @10:24AM (#16309286)

I agree it is indeed normal if Tether is backed.

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Re:Tether says its cryptocurrency is worth $2B–but its audit... by phragomax on Monday February 05, 2018 @11:44AM (#16309945)

There were 30 million Tether stolen in November.... I would speculate that this revocation is to make it so the stolen tokens are unable to be used.

https://www.coindesk.com/tether-claims-30-million-stable-tok...

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Re:Tether says its cryptocurrency is worth $2B–but its audit... by Nursie on Monday February 05, 2018 @10:15AM (#16309222)

Unfortunately I don't think anyone has a good explanation for any of it yet.

It's strange to issue a revocation, but then it's also strange to get subpoena'd by CTFC, and to print 850 million tethers in the same month you fail to get an audit through...

A revocation of about 1.5% is just another confounding factor at this point.

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