Re:Crypto.com Will Delist Tether in Canada
by dragontamer on Tuesday January 10, 2023 @08:43PM
(#34334016)
Let's say there is 60 Billion total Tether, but only $30 Billion backing it.
As soon as people realize the issue, they will trade USDT for USD. Tether will defend the peg, spending $30 Billion to hold it's value at 1 USDT for $1.
Thirty Billion later, the overall situation is 30 Billion USDT remaining, but the bank vaults are empty nothing left over to defend the peg.
As soon as people realize the issue, they will trade USDT for USD. Tether will defend the peg, spending $30 Billion to hold it's value at 1 USDT for $1.
Thirty Billion later, the overall situation is 30 Billion USDT remaining, but the bank vaults are empty nothing left over to defend the peg.
At this point, USDT snaps to $0 very quickly.