If so - be aware those are felonies in many industries and are probably criminal in most jurisdictions (fraud at a minimum). For very good reasons.
The pretending part that Tether and Bitfinex were doing was fundamentally different than the walling happening within financial institutions, where it has to be disjoint staff, disjoint control/leadership, and if someone sneaks through compliance and shares data (wink wink) it is highly likely someone will get fired if compliance finds out.
In the Tether/Bitfinex issue, they shared board members and ownership despite claiming they didn't in public, and were misrepresenting themselves in a very material way as independent.
If you were just adding some information, apologies. If you were advocating that clear evidence someone is brazenly committing a crime is not a justifiable and strong reason to distrust them, or even that it is inappropriate to hypothesize how they could be getting rich while continue to do similar things - then yikes?
If you were saying Situation Normal, All Fucked Up - then extra yikes?
Goldman Sachs (or some random VC firm) say might have some subtle versions of this going on, but if they were doing what Tether is and has been doing right now, they wouldn't be a solvent entity for very long. That Tether is hiding from jurisdictions (for now) in a way that Goldman can't doesn't inspire confidence in their trustworthiness or stability going forward, as they're clearly on the radar now and blood is in the water. Along with a lot of money and some high profile political promotions, potentially.
If someone runs across Tether (somehow?) explicitly committing money laundering in a jurisdiction that FinCEN controls, yeah they could go after them - but since they don’t have an address near as I can tell, that’s not easy to do, and all they say on the matter is they are ‘incorporated in Hong Kong’ [https://tether.to/contact-us/]
Also, their ‘proof of funds’ is kinda ridiculous from any sort of auditing or compliance perspective and crazy out of date [https://tether.to/wp-content/uploads/2018/06/FSS1JUN18-Accou...]
If you have any more accurate information, please post!
I'm having trouble to find comprehensive data on USDT burns but https://coinmarketcap.com/headlines/news/tether-just-burned-... seems to suggest that one billion is extraordinary (and those weren't removed from circulation but swapped to another chain), and Tether finds it Twitter-worthy when they burn 100 million: https://twitter.com/Tether_to/status/1225088948243968005
For sure I don't expect Bitfinex fiat withdrawals to match fiat deposits, but 100 million USD withdrawn vs 30 billion deposited seems unordinary?
Either there is a broader accounting issue with minting and burning methodologies or people/entities really do hold.
During bear markets large market participants are still buying, and a tiny portion of people are providing the price discovery, and this is mirrored in the increasing amounts of crypto that have not moved from addresses in a long time.
Many people hold the stablecoin itself, instead of going back to fiat. So there is growth of all market participants, even during bear markets when other cryptos are falling out of favor.
Thinking out loud, I've paid a lot of graphic designers and marketers in India this year in Tether. They arent familiar with crypto but just notice that their Unocoin app takes it. We’re not doing paypal, and all fiat transfers are domestic with none of fees, time, or scrutiny that an international fiat transfer would have.
The nature of all stablecoins is that if the supply does not match the demand then there are arbitrage opportunities to mint more, which can be initiated by the user. If Tether is worth $1.02 then you can mint a new tether by depositing on Bitfinex and selling that Tether for a 2% premium.
So if all the stablecoins have similar growth patterns, the things going for Tether are simply first mover advantage and greater clout in Asia.
Sure, but what if Tether is at $0.98 - how do you get dollars back?
Not all countries like US can get an account there or use fiat so I wouldnt know if the redemption mechanism is currently working or not
As a matter of fact that is NOT true. (speaking as a crypto hedge fund manager, active since 2013, and trading > $1B/month on all major exchanges). It used to be like that in the past (when USD and USDT where one just represented as "USD" on Bitfinex), but this changed a year or two ago. Now, USD wires are being credited as USD and USDT deposits are being credited as USDT. And there is a USDT/USD market on Bitfinex to exchange between the two.
Likely they all piggyback off of each other’s implementations in the face of evolving regulatory guidance
If they did, it looks like it's closed now. At least in the US, converting between two cryptocurrencies is a taxable event:
> There are plenty of questions about whether or not investors can claim a direct crypto conversion (e.g. bitcoin to ethereum) as "like-kind", avoiding taxes on those transactions. The tax laws changed beginning in 2018, and like-kind exchanges are only applicable to real estate transactions.
https://www.coinbase.com/learn/tips-and-tutorials/crypto-and...
If you made profit and traded against another coin, you pay tax, simple.
If you hold for a year though. You dont pay taxes.
My portfolio is up quit a bit now and its almost a year. Hope it stays almost like that just few more weeks :)
But who knows?
edit: Perhaps that was overly snarky - the issue is that the US requires legitmate banks to take certain efforts to identify their customers (KYC), and prevent money laundering (AML). Meatspace banks aren't perfect in this regard either, but many crypto exchanges are either unable or unwilling to do this, or are already proven to be engaged in fraud or other financial crimes.
Then there's, like, the other 4+ billion people in the world.
Its like cellular service in an underground subway station: people tell you it arrived and use it and nobody thinks about it afterwards. There wont be a source about that whether you believed it or not.
USDT is as frictionless so it just has use.
Most functioning governments also keep a balance of payments (https://www.imf.org/external/np/sta/bop/bop.htm).
If the flow of imports / exports doesn't line up with the net flows of payments, someone would raise a flag.
So yeah, unless it's ML / illegal trades, we could at least figure out a way to track it.
The world toolset doesn't function under a “your either with us or against us” mentality, it functions as a gradient.
That gradient is that the NY AG case showed Tether was functioning properly until 2017/2018. If you were around crypto at that point in time, you would know that people would not have believed they had full reserves ever.
Just reread what I wrote. You are deciding to see advocacy for Tether which is not what I wrote at all.
Your selective omissions imply advocacy - at least this is how it seems to me, and I'm not saying that's bad/good.
The accuracy of any statement can be weighed and discussed on its own merits
It comes across as dishonest and makes me, an outsider, wonder how much tether you own.
All the AG report shows is just more evidence it's one huge scam.
But Paolo himself post that all the usdt minted is 'tron replenish' everytime whale alert tweets about 800,000,000 USDT frwshly minted
So, basically, in your intentions to defend USDT you are even contradicting what its own CEO says...
It's also funny how tesla 1.5b investment and microstrategy few millions buy are to be 'celebrated' as big and huge, yet you are trying to convince us there is people depositing 800m daily into bitfinex?
The volumes from a large crowd that can also include institutional can very easily be large.
A recent example is the Saudi Aramco IPO, particiption in that IPO used Saudi retail investors and Saudi payment rails and resulted in $25bn in purchases. That one country’s internal financial system was able to handle it and there was just that much participation.
Tether doesn't have the transparency we will want. Choose a different product for that reason alone, and there are options now.
But assuming the worst, out of the universe of assumptions, is just as useless as assuming the best. The western world says “all this is improbable so lets assume it is impossible”, the eastern world doesn't seem to care and there are examples where much larger sums of money could show that Tether’s growth is not improbable or impossible.
The point is that $30bn of deposits (whether some of that is counted incorrectly on multiple blockchains) is not noteworthy enough on its own to reinforce your conclusion. Many random brokers have that. If they had a stablecoin that was minted upon deposit, you would see the same thing. And here, institutions also use Bitfinex and $30bn is actually then a reflection of how small the crypto markets are.
> ... yet you are trying to convince us there is people depositing 800m daily into bitfinex?
800m daily would have meant 300 bn USDTs created in a year. They create 30 bn in a year, no 300 bn. It's huge but you are one order of magnitude off no?
Which is insane. Those are customer funds, that Bitfinex owes to their customers, if they choose to withdraw from their ecosystem.
They aren't a personal piggybank for them to dip into as they please.
This is not at all like fractional reserve banking, where a financial liability (customer deposts) are used to print dollars (in the form of loans), because customer deposits can be called back anytime, while loans cannot.
With Tether, if Bitfinex takes a dollar a customer deposits, and then prints and sells a USDT, and the customer withdraws their deposit, they have to destroy a USDT, in order to maintain the 1:1 peg. There is zero evidence that they are doing this at anywhere near the rate they claim.
Ironically, what they are doing is very similar to a double-spend.
Thats an additional fact that the amount is in line with the amounts that would be deposited into any big exchange.
If Coinbase minted USDC whenever someone deposited, you would see the same kind of growth.
The basis of your entire post is assuming impropriety based on pretty normal behavior with the addition of the business quirk of when USDT is created.
The ability for impropriety is a good enough reason to avoid it, and their unilateral willingness to do so without any discussion can reinforce that. But people thought everything you thought since the beginning of Tether in like 2014 or so, but the reality is that it “only went fractional reserve” in 2018. Its kind of like they threw up their hands and said “well people think its a ponzi anyway might as well cover this business debt!” The irony being that the NY AG investigation actually proved that prior to 2018 it functioned exactly as promised, barring their 2017 distress by having nowhere to put their fiat deposits.
But if you assume that it hasnt come crashing down because Bitfinex does what they said, then it still does make sense: crypto prices pump after Tether mints because it is people depositing into the exchange and then buying crypto.
Any way glad USDC and DAI are growing a lot now, which have grown by the same orders of magnitude.