Bitcoin Forum

I was scrolling through cmc and I didn't realise until now that tether has the 4th highest market cap at ~$20bn. This feels like a really high risk asset and that's probably reflected in it having a 5x market cap daily trading volume.

It's probably just something to take note of that if it isn't physically backed and we see massive volatile moves then don't trust it to peg the dollar especially if it keeps getting a higher and higher pool of funds that are thought to control it (its a shame a lot of sites use it in futures).

You're right. The team has not even disclosed its price to remain $1. Here are a few points to look at the other side:

• 20B circulation with nothing backed
• No proof of funds either
• Banking partner on the Bahamas
• Lawsuits are pending
• No physical operation location
• Without any regulation
• Prints n x USDT like feds

I am worried about my funds in USDT. I think I have to move to USDC or BUSD.

This because the investors now slowly realize that instead of converting their bitcoin to fiat currency it would be better to convert it to a stable crypto like tether. Well, it actually not a bad idea because an investor may be able to save money from the fees deducted in every transaction from the third party service like banks. High fees can be deducted compare to crypto to crypto conversion. It could save a lot of money especially if an investors has a huge bitcoin holdings during the conversion process. Even myself would use the stable currency to hold funds and wait again the best time to buy bitcoin.

There is no reason to convert your Volatility coins into fiat when we already have stable coins like USDT, USDC and DAI, I'm sure many people are just realizing that now, USDT is the most popular stable coin and some have a bad feeling about the stable coin because it's centralized, the fact is look around you, even decentralized coins aren't safe

The best advice I can give is never keep to high money in USDT, I heard that USDT can freeze address too making your stable coin useless but I guess that's because some people are using USDT to fund illegal entities, for safety reasons it's better to keep up to 10k with USDT only

Tether do not just freeze addresses, they freeze it during scam accusation, a good last example I heard about was during kucoin exchange that was hacked, the scam address used was freezed by tether.

But tether do not have good reputation in the community, tether should not be trusted and people should not think about it being backed by anything, the coin is shady.

what's the latest on the loan from tether to bitfinex? the last announcement i can find is february 2020 where they repaid $100m. is there really nothing new since then?


i wouldn't say nothing backed. not fully backed, sure. :P

banking in shady jurisdictions behind shell companies ("like criminals" as giancarlo once said) is how they keep withdrawals flowing. it's a dirty job but someone's gotta do it.

i wouldn't pay the lawsuits too much mind. lots of frivolous BS there, just like the lawsuits against other exchanges.


that's reasonable. unfortunately for me, USDT is the only liquid stablecoin on some of the exchanges i use. USDC just isn't big enough yet. :(

I don't fully trust USDT but I still use it anyway since top exchanges like binance have confident using the stable coin, there is no exchanges that failed to list USDT on their platform as I know, all I can advice is to always keep small amount of money in USDT or other stable coins, nothing is guaranteed in this space

The rumours about their coin not really pegged to dollar in 1:1 ratio is kinda worrisome though. I don't really know how they could grow this fast though hopefully if I save up my USDT in some of exchange for just temporary if the worst case happening reveals that USDT gonna flop I could quickly exchange it to something else like ETH, BTC or another stablecoin.

To me, USDC is really promising nowadays but everyone still uses USDT. However, never trust privatized centralized stablecoin as you would trust decentralized exchange, just use it as you need it.

But I wonder why USDT is still the most trusted stable coin out there, at least based on crypto exchange acceptance, trading volume, trading pairs, and so on. The controversies hounding this token have been around for years now and yet look at its daily volume. It has an astounding almost $90 billion 24-hour volume, way higher than Bitcoin's itself.

Years ago, it would have been understood why USDT is on the top of the stable coin list. It monopolized the stable coin market. Today, however, there are more reliable competitors and yet it seems only USDC managed to get relatively close. The next in rank, TUSD, is so far behind.

It's widely known that USDT is huge, but I believe the most important (and scary) questions haven't been asked.
(1) Is it going to bust?
(2) What will happen to the crypto industry?

That's the sole reason I still doubt about $100k BTC.

Tether would be the trigger for the Gox 2.0

It is possible that we are experiencing the upwards movement before the big dump. Hopefully not but going this high in such a short time frame is suspicious if you ask me.

In 2017/Dec when it was going up people thought it was going to go higher and higher forever till it hits $1m.  ;D Then boom.

You don't wanna be on the wrong side of this when it  "Booms" (if it ever)

i agree with that. usdt has some assets but i believe also, that theyre not fully backed. they already admitted it once, last year, about not being fully backed (https://www.coindesk.com/tether-lawyer-confirms-stablecoin-74-percent-backed-by-cash-and-equivalents). they already lied once, so dont be surprised if they are still playing with us. so up until today, i have hesitations if they are now true to themselves about such having 20B of assets. it seems too much, i guess.
yeah, lawsuits? it is basically everywhere. and most of them are just being ignored. cant move forward because no one is seriously pursuing it. because no one can truly waste their resources with no assurance of what they will get as results.

They've backed it but there's no security that it's in full amount. Quite scary if something goes wrong with Tether because it will definitely affect the market again.
Just like how it affected bitcoin during its pumps then it has something to do again for its dumps.

Imagine if someone tipped the scales over and USDT comes falling down like a stack of cards. I get that it is ‘backed’ in some ways though idk if that translates to the entirety of its market cap or just some portion of it. Once something goes terribly wrong for USDT, see how it affects most of the crypto industry that relies on it to safekeep value when they are not trading cryptocurrencies themselves.

I can't use usdt on coinbase (they only have usdc and dai for most European investors - dunno if its different elsewhere).  Binance have put in efforts to list EVERYTHING THEY CAN FIND. that looks like a safe enough stablecoin. If a lot of people use coinbase when they come to crypto then I think usdc liquidity might see a rapid increase (which it should be able to absorb).


A wise person might consider this shady practice. You can find spring water in vending machines priced at £1.50 but the free fountain next to it or any tap may produce the same type of water (the US sources a lot of bottled spring water from taps, Europe sources a lot of its tap water from springs ;) ).

I dont think you have to be worry at this point...maybe you are right in some points but you must not forget that tether is already on of the strongst coin in the crypto market and even if somthing bad will happen to usdt will not happen suddenly

I recently noticed it too. In my mind Tether's market cap was 1-2bn and I was in a mini-shock when I saw it x10.

Imagine what will happens with the whole crypto ecosystem if Bitfinex screws the stuff.

LOL. $1 billion was the market cap three years ago, in 2017. After that there was a steep increase. But most of the increase has occurred in 2020, when the market cap went from $4 billion to $20 billion. Worryingly, this means that at least some of the cryptocurrency users are holding their wealth in Tether, rather than using it solely for trading. It is just like holding your coins in exchange wallets.

But then you change an apple for an apple. You change the conventionally accepted means of payment for goods and services around the world to its full counterpart, but just in a different wrapper. Tether  (or any other stablecoin) can be printed as much as you want for the needs of the market - so the more BTC costs, the more users will need Tether and the more it will be "printed"...
You understand that this totally does not make sense? You just took and changed one wrapper to another and paid  fees for it, however essence remained the same.

The fact that USDT has yet to show support may worry anyone. But the high volume shows that there are investors who are preferring it to all stablecoins. Sincerely USDT maintains its controversy, time passes without any statement of endorsement of its funds. In view of this I would also choose another stablecoin and choose between DAI, GUSD and BUSD.

Yeah, Tether is way overblown and it should not be this big, people have been using it freely for years now but I have always said that giving this much money and power to just one company is a big big risk that we should not do. Now it is at incredible levels and 4th in ranking, which means if tomorrow that company decides to say "we are closing shop, all your money belongs to us now" that would crash the market like never seen before.

I understand that they are making billions of dollars, so people think "why should they close it when they are making billions" but I still do not want to believe that people are not greedy and they are not idiots, obviously just like anyone in the world when this company sees billions in their accounts they must be thinking of just spending that and living like kings until they are caught and using that money to get out of jail.

Do you understand the concept of a market crash? Why wouldn't it suddenly crash and even if it slowly went down at what pijbt would you sell? 90 cents, 80, 50 (having lost hope it'll rebound).


On its own, it doesn't.

The volume reported on cmc is 5x the available usdt. Assuming this ignores futures on exchanges then there might jot be many holders of usdt and some holders might be companies like binance also where users have set stop losses/buys (in both directions).

I don't think Tether team are stupid enough to claim they have $20 billion tokens without having anything to back it up. I believe they have some stash in Billion of USD but not 100% sure all the Tether tokens are backed. Where do you think the money used to pump BTC recently comes from or it was just pumped with air, this is the question you need to ask yourself

The rate at which stable currency are minted is becoming scary particularly USDT, it's one of the most used stable coin in crypto space without much and proper auditing ( I don't know the last time we had one ) of this massive printings. It's going to be a suicidal and a slap on everyone face if government decide to crack down the used of stable coins which they have been against even by the central Banks. USDC that's even recognised in US doesn't mint tokens the way Tether is been generated every month, capitalization increased by 8X should be questionable.

I don't want to be anti stable coin, but will really happen when regulation bodies began to suspect USDT, it was once had a negative reputation in the past for manipulating Btc price during ICO maniac.

Yeah, unfortunately, liquidity is similar trouble to me. Major p2p exchanges here only provide USDT listing. So, we can store USDC and convert it into USDT whenever we have to encash. What do you think?

You are right, the team totally failed to stabilize the price many times at 1$ and they didn't clear anything about the amount of usd they have to back the price. Tether is getting dangerous because the team behind is showed us nothing to prove. The price was doped down to 0.8usd and this can drop again to even lower prices. In the other hand, other stable coins such as USDC is becoming more famous and seems more promising to me. I guess one reason of why usdt is used more than other is because of the popularity in the famous exchanges like binance.

USDT is not to be trusted completely because it is not fully backed up by US dollar. But in exchanges we have very few stable coins and USDT is the most popular one. Still if you want to keep your fund for an extended time in dollars,  keep them in USD and not in USDT.

The majority of crypto isnt backed by anyhing, do you know it? They even dont promise for backing. However, people still investing in it

Generally speaking, if you are talking about all cryptocurrencies, then cryptocurrencies are valued due to their technical and functional features, and they are also valued due to a specific product that is presented to the public. but in the case of Tether, according to the team, almost 40% of these coins are still backed by real dollars.

I think its huge trading volume caused by people using it as a transition coin between selling one asset and buying another one.
Perhaps, there are people who truly believe usdt is going to fall shortly and they're running away from it.
But I won't believe in such thing to be honest.

Essentially, tether is quasi-dollars.  Tether (USDT) capitalization is very large.  It depends on the price of bitcoins - the higher the price of bitcoins, the greater the capitalization of Tether.  

It surprises me that US regulators are not banning this cryptocurrency asset.  Regulators usually struggle with the proliferation of surrogate means of payment.  For over 3 years (since 2017), tether has been very popular in the crypto industry.

I read analytical articles that in 2018 the Chinese actively used the USDT cryptocurrency for cross-border payments (export, import).  

Tether is a stablecoin.  Unregulated stablecoins (in theory) should be the subject of close regulatory scrutiny.  However, tether continues to function and is not banned.  I cannot explain this fact.

My take on Usdt has always been the same, I've been consistently saying that tether is a ticking time bomb in the crypto world.
For what it's worth, IMHO tether is doomed. Whenever CDBC regulations will be set forth, Tether is about to explode. Don't worry though, Bitcoin will survive this event too.

It is baffling.  Tether is effectively a digital recreation of the "Liberty Dollar" and they put a stop to that pretty swiftly.  This is some low hanging fruit and the regulators bizarrely aren't gunning for it. 

Maybe they're just biding their time for the right moment to strike?  It's the only explanation I can think of.

This is what worries me. I'm quite sure of bitcoin's possibilities, its safety and all that, but if we allow private companies to produce tokens on massive scale and exchange it for bitcoins, we're taking a huge risk. If I told you now that I have a USD equivalent and I will give it to you for your bitcoins, would you believe me?
If I had an exchange and made a token accepted on my exchange, would you sell your bitcoins to me in exchange for that token?

When I put it like that most of you probably think that you wouldn't. What makes you trust people who make tether then? Those people said that they are backed and later were caught lying. Why do you still exchange your bitcoins into tether instead of choosing more transparent stable coins?

Their lawsuits are still in pending status but still people doesn't care about those things, all they concentrate on price of bitcoin and they convert their profits into USDT mostly because it is available on most of the exchanges compared to other stable coins which are actually better than tether. Sudden explosion of tether will affect the price of bitcoin extremely for sure so crypto users should move their funds store in stable coin has to convert them to completely decentralized coins.

I guess you don't understand art as it is not backed by anything, yet people still invest in art.
Wine is useless, yet people still fill their cellars with it.
The same goes for many other things which are not backed by anything, yet people invest in them.

Honestly, I've seen a lot of statements about usdt being a enormous scam project and as far as I know they're being sued or investigated on this matter.
I won't believe it until its proven so

Good thinking. If you are just a casual holder/trader, and you are able and willing to use Binance, that's an option. They have the only relatively liquid USDC/USDT market: https://www.binance.com/en/trade/USDC_USDT

Not enough liquidity for whales or even mid-size traders though, and US residents can't use Binance, so it's not really a scalable solution.

Tether to me seems to be the scam of the century. I believe there are way too many better stablecoins like Binance's USD (BUSD) to convert into, but as I can see that it can't be used on too many websites (especially on gambling and casino sites which are mainly targeted by USDT users as well as probably no direct purchases) is the reason here why tether has been a big hit.

It's not just Tether, though.  Any privately owned currency is problematic, since you have to trust the entity that claims they're holding the funds.  I'm staying away from all stablecoins that consist of tokens supposedly backed by private wealth.  They're all effectively IOUs.

Such tokens were created as a counterweight and at the same time a tool for interacting with classic cryptocurrencies, which, as is known, do not have any material, financial or other security in principle. Here, the level of security and the capital that stands behind the token comes to the fore. As for the capital security of commercial enterprises, scandals constantly occur in classical markets, and with such tokens, this can happen even more so, given the specifics of the cryptocurrency market with its multiple ups and downs.

This is getting to that dangerous levels right now and people are not aware of it just yet. Realize that bitcoin is something decentralized and awesome, many other projects are as decentralized as bitcoin (with some centralized coins like XRP as well) but USDT is fully centralized, there is nothing that we can do to stop tether company stealing our money if they want to, we have no power over that, it is not different than fiat, instead of us government deciding what Is going to happen with USD we just shifted the power to a company and that is even more dangerous than a government.

The day USA government says that USDT is banned and illegal and they want to jail the owners (like they did to bitmex for example) we are done, screwed, a big huge crash will happen. I think we should realize that we need to stop with all of this USDT hype very soon.

Tether was originally created for the purpose of trading and at least during the initial days cryptocurrency users hardly used USDT for anything apart from this purpose. But nowadays a lot of the users are holding their wealth in the form of stablecoins. The excuse being given is that cryptocurrency is too volatile to store, and therefore they want to store their wealth in a stable asset. IMO, this is just outright retarded move.

I use Tether as a crypto-fiat gate only, not for long term storage, so I don't worry about my USDT holdings, they are relatively small.

How many people care about Tether's issuance and backing policy? No one cares, otherwise it wouldn't be so heavily used. It's just another way to avoid fiat and to stay in crypto, that's what it is.
If it will collapse, people will cry becuase they didn't know, but the bubble is there in plain sight.

Do you have any sources for this? I remember I read about it a little while ago but I forgot where it was. I wonder when will they place the bomb. I guess they wait for crypto to moon even higher before they act.

He's probably talking about this one:

https://www.coindesk.com/nyag-tether-bitfinex-loan-documents-coming-weeks


Remember that this incident happened many years back (although the legal process is ongoing), when Tether was still in its infancy and when the market cap was only a fraction of the current level. Just imagine what will be the impact, if something like this one is uncovered now. Let's just hope that it will not happen, but if it occurs, then it will be the biggest scam in cryptocurrency till date.

I also use it in a limited way because holding it for longer has so many risks associated with it. If it does not get hacked by somebody, then sometimes I have seen some project owners ditching their investors and holders by dumping the project in any way. I always remain scared when I use USDT or any other fiat-pegged coins that some day, if I don't see them in my account some day, it will just break my trust from these stablecoins.

That is something that people have been fearing for a long time, tether is like any other fiat currency and we all know that fiat currencies regardless of their promises eventually fail, what we do not know is when this will happen, and when it happens, I'm pretty sure that the market is going to be affected significantly, what I do not know is how long this is going to last, the market could move very quickly and move to other stable coins and to bitcoin and recover in months but it could also lead to a massive crash that it take us years in order to recover.

To me Tether is just an extra unnecessary risk traders take. I wouldn't trust a company to hold my funds. I barely trust the fortune 500 companies to manage funds because they have an interest aka to make a profit. And they have to obey a lot of regulations.

are there any stablecoins that don't fit that definition? most people think DAI is decentralized, but DAI is actually majority backed by centralized assets like USDC, PAX, and WBTC. there are huge third party risks involved.

the way i see it, different stablecoins come with different risks:

• the odds of USDC or GUSD becoming unpegged due to insolvency (like a bank account getting seized) is extremely low because their issuers are super compliant in terms of licensing and AML. the odds of that happening to USDT are much higher.
• however, the odds of USDC or GUSD becoming infungible (or having your account closed or being reported to regulatory authorities) is much higher than with USDT, since tether and bitfinex are much more lax with AML/KYC stuff re secondary markets.
• "decentralized" stablecoins like DAI represent another risk: bad smart contract execution, bad governance, network congestion, etc can cause unexpected and catastrophic losses, like the $4.5 million lost in DAI during the crash in march.

In short, if you are holding a stablecoin there is a huge amount of risk, either from your account getting frozen or as a result of the coin getting unpegged. It is for the user to decide which risk they want to take. This is one of the reasons why I never use stablecoins. Another reason is that volatility goes both ways. If you convert your assets to stablecoin, then there is always a chance that you will be left behind during major cryptocurrency bull runs.    

Same here, already halfed my USDT and exchanged it to USDC.
Not so worried, thats just a rational safety call

You think? We are going to enter 2021 and there is a wide acceptance of something known as "proof". They can't admit if 1 USDT is backed by 1 USD.

I too read the article somewhere. But this is what I camp up with: https://www.courtlistener.com/recap/gov.uscourts.nysd.524076/gov.uscourts.nysd.524076.154.0.pdf

In order to encash bitcoin, people use p2p platforms. The problem is USDT has become popular with almost every p2p platform but we are not seeing USDC. That is the issue we are facing currently.

At one point, we want to avoid high risk with Tether and on the other point we also avoid getting reported to authorities. Due to smart contract vulnerabilities, we also want to avoid DeFi solutions like DAI. So, I don't think we have other options here. On top all of that, I think USDC can be a secured bet.

I don't know why you guys continue to hold your wealth in the form of stablecoins. USDC is not safer than USDT. All the stablecoins are risky and holding them may result in huge losses for you. If you want to store your wealth, then store it in the form of Bitcoin. Obviously the risk of volatile exchange rate is there, but IMO this risk is lower than keeping the wealth in the form of stablecoins.

That sounds pretty serious:


Pretty much sums up what people were worrying about.

This post deserves another quote because you stated very simply what are the real issues behind so-called stable coins. If people aren't able to see the real dangers here there's not much that can be done but I think writing this over and over again may help a few to see the truth behind those fiat currency digital artifacts.

This actually the best use case when it comes to these stablecoin as a temporary way to store our money really. Basically a place to resort when we gonna cut lose while market getting dumped fast. But the idea of a stable coin having this kind of humongous market cap is kinda disturbing although that's only my opinion. Honestly USDC or any other stablecoin should really give a competition to USDT by increasing listing in most of market. USDT is already too comfortable being most preferred stablecoin just because the simple fact that its listed everywhere.

Plus, if governments are looking to pursue CBDCs, every single private stablecoin is at risk from regulatory pressure.  CBDCs won't need to compete with stablecoins for market share if stablecoins are simply legislated into obsoletion.  I think their days are numbered.

with libra diem launching next month, (https://www.coindesk.com/libra-diem-rebrand) things are heating up. libra is what got congress really talking about crypto regulation, and i have a feeling it's about to thrust it to the forefront again. the bitcoin bull market is accelerating things too.

there is always a chance that governments tread lightly in favor innovation in the DEFI space. wouldn't that be nice? :)

Well, I can’t help but worry about it, because if by "survive" you mean "1 BTC will always be equal to 1 BTC", I'm not exactly happy with that. Being paid for some jobs in BTC, I don't want my hard earned $500 turned into $50 one day.

Maybe they'll maintain a light touch approach while CBDCs are still in the research stage, but I can't shake the feeling their priorities will change if CBDCs ever reach the production stage.  I suppose that's still a big "if", though.  Part of me thinks these central bank currencies won't get off the drawing board for another 5 - 10 years.  The corporations need to use their head start wisely.  There's a remote possibility that if Diem is successful and can gather a large enough global userbase before any government coins are launched, it's conceivable that governments would just co-opt that system instead of attempting to recreate it themselves.

This is one of the problems of BTC. People still want the USD not BTC. Everybody value their goods in USD not in BTC.

Even most of the BTC believers(!) are after more USD and that's the only reason they invest in BTC.

For me, this is very fishy. Why the congress is so concerned about Libra/Diem? After all, it is a centralized digital currency and is more similar to digital versions of fiat currency such as PayPal. It is a hint that the politicians are not very comfortable with the rise of Bitcoin and other decentralized cryptocurrencies. Libra/Diem is just a diversion. The real target may be Bitcoin.

Same reason they didn't like the Liberty Dollar (https://en.wikipedia.org/wiki/Liberty_dollar_(private_currency)). 

Its not about keeping wealth in USDT. Stable coins like USDT, USDC comes into the picture when someone wants to sell high, wait for dip and buy low. It is obvious that USDT is not one kind of investment but it helps to accumulate wealth one possesses.

That is some serious shit man. It could be very disastrous if any one of the point goes wrong from the above list that you made.

At this point tether is like tip of ice burg on the verge of imbalanced posture and the cause could be anything from above. I don't know why but since the bitcoin has risen in the price most of the people have secured their assets in the USDT and that's ridiculously heavy burden on this firm. Im not sure how they will maintain the price to optimise the USD rate but if anytime huge dumping starts they will have hard time doing so. And that legal petition is also heavy risk for this project including no physical location can have law suit filed more stringently.

I totally understand your point, and I wish I could say "I'm a hard-core hodler" about myself, but in reality I am not, sorry. I have bills to pay, family to feed. Of course it would be great if we could forget about fiat completely, and all payments were in BTC only, but it's impossible at the moment.

That being said, I respect people that can afford holding their BTC. I realize that they are doing good for Bitcoin.

If someone want to do that, then why can't they keep the balance in USD or EUR in the exchange itself? What is the point in converting USD to USDT? I know that storing your funds in exchange is a very risky option, and there is a good chance that the exchanges may close down suddenly taking your funds with them. But storing your money in USDT involves the same amount of risk, as it is a token issued by the Bitfinex exchange. 

As said by Tushar Ramani USDT came into the picture when traders are making losses when the is dumped and there's no way to keep their profit but I'm not a fan of USDT though it is the pair used by most exchange site and conversion into USD/EUR will also attract another fee. Besides, what's the purpose of crypto if investors decide to hold USD/EUR instead of stablecoins?


Yes and this is the reason why i am not a USDT fan but holding USD/EUR is not an option since we have other decentralized stablecoins in the market.

Definitely. And IIRC there was actually a change in their T&Cs just a few years back that allowed them to essentially do fractional reserve and count non-cash assets as reserves even though their initial mantra is that USDT should be backed 1:1 by physical cash.

It is essentially a bank without a banking license, if you think about it. And I think that will be liable to falter for sure come some sort of liquidation crisis/bank run.

I would not use USDT for any more than day-to-day transactions, as the market's high turnover of the token seem to suggest. Do NOT use it as a store of value. But even then, there is a risk at any instant that the fractional reserve is going to collapse.

Now everyone has seen what lawsuits can do to cryptocurrency, after XRP lost 60% of its value in a single week. With the NYAG litigation against Tether not settled yet, why no one is considering such a possibility with USDT? There is a real chance of their remaining assets getting confiscated, if the NYAG believes that the Tether foundation indulged in some sort of fraud with the reserve funds.

This is basically exactly the same situaiton as XRP is going through right now and what Bitmex went through as well. When you are doing a financial business and you are not registered in USA but deal with a lot of American citizens you are going to get into a lot of trouble, which is why I have repeatedly said that USDT is in big trouble, tether will be not only sued by every usa government branch available but they will be investigated and there will be a loooong jail time for the owners. Why?

Because if you are dealing with American citizens you need to pay your taxes in USA as well, if you do not want to do that you need to bribe the right politicians so that they could keep you from harms way, if you both make your profit from mainly Americans and do it in a financial corporation while not paying any bribe at all? You are going to end up in jail for sure (or at least can't go to USA anymore).

I have not used that USDT in a very long time now, but there are lots of people that are making use of it and Tether is like the most popular stablecoin in the market, a lot of traders are making use of it and they don’t even consider other good stablecoins there are out there. Tether is no longer fully pegged to US dollar so why would anyone continue and they have also have a lawsuit against in New York, it’s like a serious and I have been seeing questions popping up everywhere online on how this is going to affect the market if they happen to collapse. This is the best time to look for the coins that are reliable.

It is not unnecessary in the sense that it allows you to get out of the market of cryptocurrencies for a time and the ability to get back in it immediately, if you have tried to actually send your money to your bank account you will know what I mean, supposing everything goes smoothly when you sell your crypto for fiat then you could get your money in a few days, but we know a lot can happen during that time making you lose precious time, in the worst case scenario your account is blocked for using cryptocurrencies and you now nee months to get your funds back and have to go through a lengthy legal battle to get your money, so as you can see even if I do not like USDT myself I can see why it is useful.

It's very much a "path of least resistance" kinda deal.  Regardless of how shady it looks, traders want the liquidity.  It's shortsighted and risky, but it's convenient.  They'll keep using it until it blows up in their face.

I think people have a bad feeling about it because it's not transparent, no? Centralization isn't inherently a bad thing. The thing that makes something untrustworthy is an inability to understand how it functions, whether it's centrally run or not. The fact that no one can verify USDT is backed by anything is what makes it risky.

Nobody can verify their BTC or USD balances are backed by anything at Coinbase or Bitstamp either. No audits have ever been done. Yet all the attention is on Tether. Funny, that!

Just saying! :P

The real issue is about avoiding third party risk, period. I'm afraid of Bitstamp for completely different reasons: I'm worried they'll freeze my money for months and maybe even send my information to the police. That's what they do, even if the balances they issue are fully backed.

Centralization is bad, because the Tether foundation can freeze your tokens without a valid reason. The IRS and other government agencies can seize your wealth, if they are stored in centralized coins such as USDT. Bitcoin was invented by Satoshi Nakamoto in 2008, mainly to prevent such incidents. There was a reason why he went for a decentralized coin with no central authority. Stablecoins such as USDT and centralized cryptocurrencies such as XRP are exactly opposite of what Satoshi had in mind.

Well, I didn't even know this and had USDT in 4 figure amount. One of the threads here brought my attention and I researched a bit. Now I have moved all of em to USDC now!

By the looks of it this superb increase in bitcoin doesn't negate the USDT number and that is the funny part of it. What happens when bitcoin goes down a lot? People sell their bitcoins and that is why Tether marketcap goes up, because they trade it for USDT and that means USDT is needed a lot, if there are not enough in the market Tether prints more and people can just exchange it for USDT easily thanks to that.

However what happens when bitcoin becomes 28k+ ? Because that means everyone is selling their USDT and buying Bitcoin with it, which means we do not need this much USDT in the market, does it get lower? Obviously not. So, that means when people sell their coins to USDT they print more, but when they sell their USDT to get coins they do not burn theirs, they just let the market handle that part instead. This shows that USDT doesn't have good intentions at all.

Obviously USDT is "unbacked USDT" in the eyes of law because there is nothing backing it up for real. It looks like Tether is backing it up but how many people actually gave USDT to tether to get USD in return? Not many I would say, not 20 billion dollars worth of check on them for sure.

It means most people use it just to feel like it worths 1 USDT equals to 1 USD and thats probably the case, but without the real backing of it thats just a guess.

Most people who want to cash out changes their USDT into bitcoin and then change it to dollars that way, not directly from USDT to USD at all. Which is why I would assume that it is unbacked until proven otherwise, I would personally need to see some sort of proof that someone turned their USDT into same amount of USD from Tether itself, and not a small amount neither, I would need millions of dollars proven as well, otherwise they just "say" that but how can we believe them?

Everyone knows that USDT will blow up and still there is no other choice and hence forced to trade using that. With SEC coming hard on Ripple we should expect more rulings to come in the near future and once the shady market is clamped we might see the entire market coming down.

I am expecting the authorities to shut down USDT altogether like they did with Liberty Reserve.

Maybe, but something tells me it won't end there.  While it would definitely knock a fair amount of confidence out of the market, some people wouldn't give up at that point and would probably switch to a different pegged token.  The implosion of Gox wasn't enough to put people off using exchanges, despite making the risks abundantly apparent, so the implosion of USDT probably won't be much different.  Doesn't matter how many people get burned, it's seldom treated as a learning experience.

But they can do it only if really big amounts involved, like hundreds of thousands USD, right? Those are measures to prevent money laundering on a massive scale. Law-abiding citizens have nothing to worry about. Am I right or am I missing something?

In one years time, a single BTC might actually be worth hundreds of thousands USD, so this is relevant even to us little people. ;)

Be careful who you do business with. I wouldn't go anywhere near Bitstamp after the horror stories I've heard.


Famous last words......

Tether is indeed very popular as a stable coin in the cryptocurrency world,
and is almost always used by all exchanges, but remember, stable coins are the same as centralized coins,
meaning that because the supply of these coins is backed by fiat, of course there has been a lot of controversy for USDT,
moreover. they are in the United States and soon the SEC is also eyeing the USDT.

It is quite simple actually people never think it is going to happen to them so instead of taking the best approach which is to learn from the mistakes of others they have to learn by being burned themselves but while there are instances in which this can be the best way to really learn something there are many instances in which it is the most painful way to learn and unfortunately many people never think about that possibly until it is too late for them to do anything about it.

whatever you say maybe all of it is true. why can Usdt have such a market cap? This is natural because Tether controls many Erc20, Trc20, Bep2, Omni, Bsc blockchains. so it's natural that many people find it benefit, especially if the transfer uses the Trc20 network which is completely free.

Question is... what are they waiting for? Will they do it after everybody buy bitcoin from $100k?

Why did they wait for ripple to become that big for years before they decided to shut it down? How many thousands of people were scammed by ripple? Do they want the same thing for tether&bitcoin?

The matter of jurisdiction raises interesting questions, doesn't it?

On paper, Tether doesn't serve US customers, doesn't issue them USDT, and doesn't transmit money for them since users send it peer-to-peer over blockchains themselves. If they don't do business in the US, what authority does the US government have to shut them down?

The CFTC would argue they have jurisdiction if Tether is being used to manipulate a CFTC-regulated market, such as Bitcoin futures. And that's why they probed Tether starting in late 2017. But the fact that we are now here in 2021 and nothing has come of it......doesn't that suggest they have no case?


Touche. They do take forever to build up these airtight federal cases. Maybe that's what is happening.

I have a working theory that New York's case against Tether is really all about the discovery process. They want to hand evidence to federal investigators showing, for example, that Tether continued serving US customers long after they claim to have stopped.

My assumption has always been that their preference would be that private companies are not issuing tokens which are tied to the national currency.  Libra/Diem still hasn't been given the all-clear yet and they're doing everything they possibly can to jump through regulatory hoops.

What if they simply want to avoid the likely game of whack-a-mole that would ensue?  Imagine they squash Tether, so users immediately switch to a different stablecoin and the whole sordid affair starts anew.  Maybe they're planning to launch an assault on all stablecoins in one fell swoop?  As the expression goes:

"When your quarry goes to ground, leave no ground to go to."

I'm probably giving them too much credit by suggesting they possess that much foresight, though.   ;D
So yeah, it's probably the discovery thing.

Stablecoins are not even profitable so they are worse than the centralized coins. 1 USDT will always worth 1 USD so there is no way of making any profit at all by buying usdt, whereas let's say XRP is centralized that much we already know and has been proven in the last week, we could profit from it, buy xrp and if price goes up you earned some profit from it. Basically it is not the same thing but at least it is a bit closer to what the reality is.

Hence I believe it is quite useless to use stablecoins because they are both centralized and very dangerous and risky, while also not profitable neither, which makes them as useless as it gets. So long story short, use things like DAI if you want stablecoin, do not use ones that are centralized, I have heard talks about decentralized ones that will be also profitable to hold as well for interest rates, those will be the real earners.

Tether was created by Bitfinex which had to provide a trading pair to US dollar which was not possible back on that days. Even now to trade crypto to fiat you have to pass KYC and not all countries are eligable to trade like this. Instead, we have stablecoins that allow us to trade without any extra difficulties. On binance you don't even have to verify your account.
On that case traders got a stable trading paid while exchange is getting a huge trading volume that increase their profit.

USDT does have a large market cap and is now in 3rd position and has succeeded in replacing XRP's position. This happens because USDT is
indeed the most popular stable coin and is widely used by investors. In fact USDT is listed on almost all exchanges, so it is only natural that
USDT trades volume over Bitcoin. I myself don't really believe in USDT, but I keep the profit from trading on USDT, because USDT is easiest
to find on any exchanges. But I also never kept large funds in USDT.

Whenever the volatility increases, the demand for USDT also increases. So of the traders go by their logic of "buy low, sell high". But this logic is not very easy to implement in the cryptocurrency market. Those who converted their BTC to USDT three months back, when the prices reached $12,000-$15,000 per coin would be regretting about their decision now.

Doesn't really matter in the end does it? I mean let's assume that you can't trade with fiat without KYC but you can with USDT, so you would prefer USDT a lot better because you do not have to KYC, and you did all your trading without giving a single ounce of information. What are you going to do when it comes to cashing out to fiat? You will still give out your KYC in order to be able to get that money on your bank account.

So, even if its just for one move (which is withdrawing) you still ended up giving your information, so if you are forced to give it during the last stage, why not use that for the all other trading as well? At the same time, if you really do not want to use your KYC or anything but not have to trust someone (in this situation bitfinex and tether), just go with things like DAI which is decentralized.

DAI don't fix this problem though. You'll still have to go through KYC when you want to get back to FIAT. DAI isn't protecting you from this scenario. Nothing does except the OTC trades or exchanges like bisq maybe.

We really don't know if somebody is demanding huge amount of tether's from BitFinex (I think not) and buying them for their real dollars, or Bitfinex is printing them away because the US lets them.

Yeah that's true. But some rumours have been leaked about usdt from last couple of months.
But i don’t know if its true or fake.
But many people has converted their usdt in other reliable tokens. Who knows what happens

Usdt is usa future of commercial transactions

Sooner or later commercial transactions will be on stable coins 

And stablecoins are trusted becouse backed by banks.

where did you get the idea that stablecoins are backed by banks???


what rumour are you talking about? not having fully backed with US$s? guess, that's old news. remember, it was in 2019 that they admitted that they were not fully backed with USD assets? wonder, if they have that amount of money right now, considering its huge market cap.

Tether is indeed on the top list on the market. The reason is that trading is now famous as a way of income for many people. And for them to trade tokens that they want, they are choosing USDT as their primary token before buying a particular token, since it is stable, it might change but not that big change. It is also the income of the trader when they are done trading, they are selling the token that they bought through USDT and they will sell it back to USDT.

I got my first cryptocurrency in 2014 and my involvement with crypto is now more than 7 years old. From my experience, I would say that I am not feeling very excited with USDT. Right now it's market cap is going up almost the every other day and everyone is happy about it. But eventually, there will be a scenario where the liquidation starts. People will start converting their USDT to USD or BTC/ETH, and this volume will be greater than the that from the other way around. At this point, it will be interesting to see how smoothly the process goes.

Usdt will take over crypto

Usdt is king of crypto numbers do the talking ....
Btc marketcap is not even half of usdt

Wat?  I don't know if you're an alt account of cryptoboss2020 (https://bitcointalk.org/index.php?action=profile;u=2835857) or not but you sound equally unhinged.

USDT is a double-edged sword, while many exchanges use it as trade-pairs, yet the company issued usdt claim it is pegged to USD but the reserve to backed the value at best each USDT is backed by only $0.74 in cash and cash equivalents, and not even necessarily by physically USD, check this out https://wallet.tether.to/transparency
Tether formerly claimed that each token was backed by one United States dollar, but on 14 March 2019 changed the backing to include loans to affiliate companies. source (https://en.wikipedia.org/wiki/Tether_(cryptocurrency))
Until 2017, the companies Tether and exchange Bitfinex insisted there was no relation between the two but in fact, after the investigation on the operations of Tether, it's owned and operated by the same people. It is only a matter of time until we find out the truth of USDT sooner or later.

https://i.imgur.com/OWGJtlo.png

Look again. For all 4 "tethered" assets (USDT, EURT, CNHT, XAUT), they report full 1:1 backing. In some cases, they report holding excess reserves. They claim to have $162 million more USD than has been issued in USDT.

You can speculate that Tether is not fully backed, but you can't prove it with Tether's own reports.

They have given out loans to their "affiliate" companies, and these loans are also included as backups. Now we don't know which are these affiliate companies and what is the risk involved here. It is perfectly natural to assume that at least some of these companies are going to default on the loan repayment. In that case, this claimed 1:1 backup will only remain on paper. And once again, these are figures as reported by Tether. There has been no independent audit by any third party.

At least right now, nothing has been exposed yet and most of the people still believe in Tether. And if Tether is shut down, it will leave a big scar on the cryptocurrency market since most of the big pair are based on USDT. It is true that up to now, they have not given any evidence that USDT is backed with dollars. Once SEC pays attention to them, we will be doom.

One of the assets that tether is backed by is bitcoin... and... bitcoin is backed by tether.

https://i.imgur.com/PbaPy14.png

Nobody will be poor in this system. Yeah it will go on forever.

They have, and in April 2019 they admitted to not being fully backed. But then Bitfinex did the $1 billion LEO token offer (raised in USDT to pay back the loan). As a result, in November 2019, they said they were fully backed by reserves again. https://www.coindesk.com/tether-says-its-stablecoin-is-fully-backed-again

Sure, they could be insolvent. But we also know the LEO token offering happened, so it's reasonable to assume that hole was plugged.

Personally I don't care either way. Holding any IOU from any exchange is a huge risk. That applies to Tether, but it also applies to a whole lot of other exchanges.

If DAI stable coin is the one that has this insane market cap will you say it's high risk asset? You people think that decentralized projects are the safest but you've forget that people operates them as well, if USDT make a run they can be hunted because everyone involved is known cos USDT was once in a mess before, but if it's a decentralized stable coin forget it....