Why Tether, why?
Anyone who follows this blog of mine knows that I'm not the biggest fan of Tether. Of course, I understand the current need for a stable coin, but at the same time I'm not convinced that it's something that will outlast these times or that the best way of doing it is by issuing backed assets. Not only because of the gray areas involved, the elements that can be easily taken down by legislative entities, but more so because of what we don't know, and the potentiality for manipulation.
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There are some prominent voices on this space on both sides of the debate. Some say that the dollar itself is not backed by anything, then why would it matter if tether is not backed as well. To this over-simplistic analysis all I have to say is one word: consensus. Most of the world agrees on the value of the dollar but the opposite is USDT.
One curious thing that really jumped at me this morning, is their updated information regarding how they "back the assets". As far we understood, or to be more precise, I understood, the idea was always that tether held one "physical" US Dollar for every token they would effectively print. These tokens would then be redeemable through their infrastructure, and this would make them as good as money. If we add to this somewhat shady idea, the fact that audits have never truly been done, we can clearly see how this whole thing smells like a ticking time bomb.
There is probably little need for me to point out the problem here. I mean, how can a serious business use these instruments for backing their asset. To be fair, there is risk everywhere in the cryptosphere, but this doesn't mean that it's OK to add more risk to the table, and it certainly does not look well for the cryptospace as a whole.
As you can imagine, memes are flying everywhere on cryptotwitter and this one in particular had me laughing. I guess if there is one thing we can do when we are facing idiocy of this level is laugh from a distance, the key word here being distance.
I hesitate to give anyone financial advice, but on this one I think I'm not taking a risk: Don't play with fire, don't get caught hodling tether when the bottom falls out.
Have you heard of Avocado coin... I'm kidding Meno lol
I missed the Avocado jokes
Kraken let's you short tether btw ;)
Oh, good to know... I used to have a kraken account, i should attempt to see if i can still access it, its been more than a year.
Affiliated entities, meaning? A vehicle of the founders most likely. IOU
I'm sure that is exactly what it is.
Actually me also did not even know much about this tether of a thing
I agree for this coin is better to watch at a distance
My concern is with their ability to print as much tether as they like without regulation and the ability to manipulate the market. Too much power for a black box coin.
Yes, that is probably the biggest risk it represents to the space.
For me, Tether needs to be only a crypto to pair with dollar. If it is more than that, the idea becomes invalid.
I saw this news pop up this morning and glad someone finally covered it on my feed or I was about to do the same thing. So they've basically turned themselves from a fiat to crypto vehicle into a fractional reserve bank using your money to make themselves even more money.
This will go find until it doesn't and they aren't able to payout USD when tether is traded during the next bear market.
Maybe a fund gamble speculation when tether stops accepting tether because they run out of USD. I think I would buy up a couple hundred / thousand tether when/if it hits $0.50 when this even does happen as we can see from history.
Incredible people feel comfortable holding Tether with these additional details that really further separates from the original thoughts. I had ways consideres then to be similar to money market funds which are used quite often in the financial system. Not too hard to manage but requires scrutiny and transparency to trust the administration of said portfolio. This would be a red flag for any person expecting this to be a store of value and peg given the further deviation from the concept!
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shadier than shady to say for the least
what do you think of TUSD in perspective?
i think all backed tokens are bs... too much of a liability. Algo based pegs, like SBD are fine, because they are not truly guaranteed. DAI btw is pretty awesome and works incredibly. but anything else, i won't touch out of principle.
a clear view...thanks bro!