The Big Short movie, BTC edition?

[Botnake]

there will be a decline if the hype has ended, but so far if I see, the bitcon hype is still not over,
If you expect the big short to happen you will miss the bullish train.

What if there's none already and anytime soon bitcoin will start to dump like a falling knife? The big short movie was all about the bubble, I'm not sure if what we are seeing is the same because AFAIK, bitcoin could dump but it's normal as it's a high volatile asset compared to the housing bubble in the movie the big short.

[bbc.reporter]

How will the judge determine this case if they will never show documents and audits to remove th doubts behind the backing USDT? Do you assume the investigations will stop?

No, the New York prosecutor seems pretty adamant about nailing Tether. I just don't think they have much actual power to do anything, enforcement wise. I wonder if what's really happening is that New York is being used as a pawn by federal prosecutors in an effort to get Tether and Bitfinex to voluntarily incriminate themselves, in a larger federal case. I really don't know though. I don't know how this is all going to turn out.

You are using the word FUD according to your own definition everytime someone asks questions?

No, I provided sources and explained in detail how beating a dead horse about Tether's imminent collapse is FUD. I also explained how it fits your definition of FUD.

In any case, another speculation for you. This statement from the SEC is very broad and might also cover Tether and many other tokens in the cryptospace.

All that means is XRP isn't legal tender. The same applies to BTC too. Doesn't make BTC a security, or USDT.

The SEC doesn't seem that interested in stablecoins. They did make these comments earlier this year, and said in vague terms that stablecoins may or may not be securities, depending on the facts. An SEC advisor recently speculated that stablecoins with fiat-backed reserves probably don't violate securities laws. Supposedly the ones that may are those where a central authority controls price variations. DAI actually comes to mind because it uses a system where a relatively centralized authority increases or decreased CDP interest rates to drive the market towards $1. Ripple comes to mind too the way Ripple Labs has withheld supply and used things like supply lock-ups to manipulate price.

Similar to Enron and Theranos, the American government will enforce their authority. The government might not takedown Tether worldwide, however, within American borders it will be enforceable. That would be the best outcome for the cryptospace, I reckon.

It is not my definition of FUD. It is the real definition. I also did not mention imminent collapse. I was only speculating that it might be the cause of a big short BTC edition.

The wording is broad from the SEC. This should be concerning because it can be used to charge many cryptocoins if the judge determines unfavorably for XRP.

[bbc.reporter]

Operation stop big short? This might be the beginning of a transformation in the stablecoin market from a USDT influenced market to USDC, GUSD and others that might be more favored by regulators.

Also, it mentions that the document can be interpreted that public blockchains can be treated as infrastructure similar to Swift, ACH ad Fedwire.

This is good news except for Tether and Ripple because the SEC has pending charges against them. The skeptical me thinks that there might be a conspiracy where there are movers behind this that favor USDC and Stellar. Am I watching too much movies again hehehe?



Breaking major news from US Treasury OCC, the largest US banking regulator (@USOCC), with new guidance allowing US banks to use public blockchains and dollar stablecoins as a settlement infrastructure in the US financial system.

The new interpretive letter establishes that banks can treat public chains as infrastructure similar to SWIFT, ACH and FedWire, and stablecoins like USDC as electronic stored value.  The significance of this can’t be understated.

Source https://twitter.com/jerallaire/status/1346233132396257282?s=12

https://www.occ.gov/news-issuances/news-releases/2021/nr-occ-2021-2a.pdf

[bbc.reporter]

There is a big dump on the whole cryptospace market and this is breaking all price support. Might this be because of iFinex, Bitfinex and Tether’s deadline of submission of financial documents on January 15?

There are people who like to spread FUD that January 15 is the judgement day if Tether is taken down or not. This is FUD. It is only a day of submitting documents and I speculate that Tether will submit a big data dump of millions of blockchain transactions to stall the investigation hehehehe.

[estenity]

There is a big dump on the whole cryptospace market and this is breaking all price support. Might this be because of iFinex, Bitfinex and Tether’s deadline of submission of financial documents on January 15?

There are people who like to spread FUD that January 15 is the judgement day if Tether is taken down or not. This is FUD. It is only a day of submitting documents and I speculate that Tether will submit a big data dump of millions of blockchain transactions to stall the investigation hehehehe.

ok, agreed...
but we will also try not to be too us-centered..

[bbc.reporter]

What has changed? I also noticed that no one from bitcoin news media have been covering much of Tether indepth. Some bitcoin influencers also appear to have changed their statements on Tether. They might be having a difficult time to call out Tether’s shadiness because they know bitcoin might not pump without it.





This is the dumb tether article.

https://crypto-anonymous-2021.medium.com/the-bit-short-inside-cryptos-doomsday-machine-f8dcf78a64d3

[bbc.reporter]

News update.

Bitfinex, iFinex, Tether has settled with the New York Attorney General’s office with the amount of $18.5 million, an agreement to submit quarterly reports of their operation and leave the state of New York. I am skeptical how the NYAG can enforce the submission of quarterly reports. This is out of their jurisdiction.

This is only a slap on the wrist for Tether and it also implies that the NYAG surrendered. However, without audits, the questions remain.



The company behind both Bitfinex exchange and the stablecoin Tether, iFinex, has ended its nearly two-year battle with New York State.

Attorney General Letitia James announced Tuesday morning that Tether and Bitfinex will pay $18.5 million in fines and be required to submit quarterly reports about the state of their operation. They also must stop doing business with “any New York persons or entities”—that’s anyone who regularly trades in New York, and any company that’s headquartered or incorporated in New York.

Source https://decrypt.co/58793/tether-bitfinex-settlement-takeaways

[bbc.reporter]

It appears that mainstream media is beginning to create a new series of storylines for their next bitcoin fud after China’s stricter policies on mining and trading. I am saying FUD because nothing has occurred for the time being.


According to experts, the SEC case against XRP is just the beginning and Tether and Binance Coin could be the next prosecuted. The allegations are from US Attorney Jeremy Hogan. According to him, stablecoin Tether could be the regulator’s new target for misleading the market about the USDT’s backing.

Source https://digesttime.com/2021/06/21/according-to-attorney-sec-will-sue-tether-and-binance-coin/



This is an interview from CNBC’s Techcheck show.



"There's a reason why they're un-bankable, there's a reason why they've been forced to give these quarterly statements...this is not the transparency people are looking for," says tech investor
@Jason on Tether

Source https://mobile.twitter.com/CNBCTechCheck/status/1406997666828099584



Can the SEC or the NYAG force iFinex, Digifinex, Bitfinex, Tether to show them those commercial papers that are supposed to back USDT?

[bbc.reporter]

Everyone in the cryptospace should read this long article. Some written in there are information we have already known about and the others we have already argued on. However, this is mainstream news media with mainstream news readers. There will be questions.

What if Tether depends on the bull market to sustain the peg?



After I returned to the U.S., I obtained a document showing a detailed account of Tether Holdings’ reserves. It said they include billions of dollars of short-term loans to large Chinese companies—something money-market funds avoid. And that was before one of the country’s largest property developers, China Evergrande Group, started to collapse. I also learned that Tether had lent billions of dollars more to other crypto companies, with Bitcoin as collateral. One of them is Celsius Network Ltd., a giant quasi-bank for cryptocurrency investors, its founder Alex Mashinsky told me. He said he pays an interest rate of 5% to 6% on $1 billion in loans from Tether. Tether has denied holding any Evergrande debt, but Hoegner, Tether’s lawyer, declined to say whether Tether had other Chinese commercial paper. He said the vast majority of its commercial paper has high grades from credit ratings firms, and that its secured loans are low-risk, because borrowers have to put up Bitcoin that’s worth more than what they borrow. “All Tether tokens are fully backed,” he said.

Source https://www.bloomberg.com/news/features/2021-10-07/crypto-mystery-where-s-the-69-billion-backing-the-stablecoin-tether

[savetheFORUM]

What has changed? I also noticed that no one from bitcoin news media have been covering much of Tether indepth. Some bitcoin influencers also appear to have changed their statements on Tether. They might be having a difficult time to call out Tether’s shadiness because they know bitcoin might not pump without it.





This is the dumb tether article.

https://crypto-anonymous-2021.medium.com/the-bit-short-inside-cryptos-doomsday-machine-f8dcf78a64d3

It has been fully known that people never cared about tether at all, it wasn't the tether "company" people cared about, but there are nearly 70 billion dollars worth tether printed out and sold to market, whoever is willing to buy it has got it, and yes they still take it back whenever needed to keep the peg, but that rarely ever happens, they have enough to cover any difference in cash but do you really believe they have 70 billion dollars in cash?

It was never 1 to 1 pegged and we all knew it but there isn't much we can do about it. As long as people have the power to do this, which tether had thanks to bitfinex, then we can't stop them from doing it. Tether is a horrible company, and even though idea about stablecoins is great, it was never great when it was centralized.

[bbc.reporter]

It appears that Tether has found another type of usage in its attempt to hyperdollarize the world without owning the official money printer from the Federal Reserve hehehe. This new usage is to be a medium of exchange to fund revolutions in 3rd world countries.

I speculate that Tether might not be allowed to exist within 3 years to stop it from being adopted by powerful figures who can disrupt the existing state of politics.



Myanmar shadow government declares stablecoin USDT an official currency

Myanmar’s shadow government, the National Unity Government (NUG), led by the supporters of jailed leader Aung San Suu Kyi, has declared United States dollar-based stablecoin Tether (USDT) as an official currency for local use.

Per a report published in Bloomberg, the NUG will accept Tether for its ongoing fundraising campaign seeking to topple the current military regime in Myanmar. The shadow government also raised $9.5 million through the sale of “Spring Revolution Special Treasury Bonds” offered to the Myanmar diaspora across the world. The group aims to raise $1 billion through the sale of NUG-issued bonds.

Source https://cointelegraph.com/news/myanmar-shadow-government-declares-stablecoin-usdt-an-official-currency

[bbc.reporter]

It appears that I have to begin to accept that Tether will not be taken down hehehe. Tether is being used to collect money to fund a revolution and restore democracy. Might this also be the beginning to hyperdollarize the country of Myanmar if the revolutionaries are successful? No one would have predicted that Tether would find a use case like this.



Political and financial scenarios in regions across the globe have inspired populations to find more stable and secure currencies to hold, leading many to Tether. Pegged to the US dollar, Tether represents a safe and assured way to hold USD on the blockchain while also offering a reliable option for economies combatting inflation, anti-privacy laws, and more.

The National Unity Government of the Republic (NUG) is led by Nobel Peace Prize winner Aung San Suu Kyi, who has received commendations from the US. The party has also been acknowledged by the European Union. The fact that it has chosen to recognize USDT as an official currency is a commendation to the strength of the US dollar and its ability to provide a safe haven to citizens of the world. The significance of this moment goes far beyond the potentials of cryptocurrency to provide financial security but points to long-standing confidence in the US dollar for those who do not have confidence in their own governments or national currencies.

Source https://tether.to/tether-responds-to-myanmar-adoption-of-usdt-as-official-currency/

[bbc.reporter]

After the failure of Terra, Luna and UST, it appears that some attention is again going back to Tether and USDT. The questions about the solvency of Tether will never stop until they go through an audit. If anyone really needs to hold a stablecoin, USDC might presently be the safest.



Tether, the $74 billion stablecoin issued by Tether Holdings Limited, has faced increased scrutiny since the collpase of agorithmic stablecoin terrUSD that partly triggered a $1 trillion bitcoin, ethereum and crypto crash (with more pain thought to be on the way).

Now, a Barclays strategist has warned tether, which claims it has adequate reserves of U.S. dollars and dollar-equivalent assets to maintain its one-to-one dollar peg, could be hit by a price spiral if holders rush to sell it "quickly before its price falls even further."

Source https://www.forbes.com/sites/billybambrough/2022/05/19/sudden-price-spiral-warning-issued-over-major-stablecoin-as-bitcoin-and-ethereum-bounce-from-crypto-crash-lows/


Also, small amounts of Tethers being redeemed will be okay, however, redeeming it by the billions might become a problem because of the question on Tether's solvency. Institutional investors and whales might have begun redeeming their Tethers for dollars already. The marketcap is now less by around $9 billion which occurred only in the month of May.

[STT]

In my experience the market will test all boundaries, it will smash against fixed objects like waves on rocks and eventually it can wear anything down, that much is giving too much credit to Tether or anything else.   It'll have its limits for whatever reasons markets have a destructive side to them, crypto has main market money involvement so we have all kinds of operators not just the original people from crypto who were happy to run a machine at a loss if need be.
  The whole idea of stability coins has always appeared a castle in the sky to me but I dont know the minute details that might allow it to survive, if it can adjust itself let off pressure perhaps it continues.   I'd rather it decline in a gradual way then just pop one day, I've never used it so why should it be my problem.

[bbc.reporter]

@STT. The problem with Tether, USDT is it is not backed 100% by real American dollars. Much of the USDT issued and presently in circulation is backed by commercial paper. I know there can be an argument that this type of backing is okay, however, Tether is not audited and we cannot be certain if those commercial papers will be good on their promise to pay.

Commercial papers are promissory notes that are issued by companies or banks and they are commonly unsecured loans without collateral.

[STT]

Sure that makes sense as it will be far more profitable for them but obviously introduces risk.   Whose to say if the risk taken is too great vs the liquidity required.   Bonds are a future payment of dollars so its not like its wrong exactly but in some cases the bonds wont pay out is possible.   If thats all the problem Tether has I dont think its in trouble just yet presuming they werent too leveraged.

Big Short was one of my fav movies because it manages to convey some things which are quite technical, seems like a good thing because I do think that process is ongoing and will effect everyone regardless.    The problem should be in the end not a shortage of dollars, default or recession but an excess which I would presume Tether could handle if it was not all at once.

  Maybe this relates to QE and that giant issuance of bonds but I dont fear anything like a Volker 1980's moment occurring, they wont do it because they cannot do it.   The fear will be of hard money occurring, greatly reducing the value of their paper debt especially as rates rise.   The FED cannot raise rates to anything like those higher levels, someone will have studied this alot better then me but they cant even go back to 5% as it will consume a large part of the budget and inflation is past that right now.   Rates cant really raise until a fiscal surplus occurs and bonds are being closed out, a deficit is still there so it does imply a constant stream of new easy money to service that gap in payments.   

[bbc.reporter]

Sure that makes sense as it will be far more profitable for them but obviously introduces risk.   Whose to say if the risk taken is too great vs the liquidity required.   Bonds are a future payment of dollars so its not like its wrong exactly but in some cases the bonds wont pay out is possible.   If thats all the problem Tether has I dont think its in trouble just yet presuming they werent too leveraged.  

We are not talking about what makes sense for them. We are talking about which companies have issued those commerial papers and why would Tether, iFinex not want an audit on those commercial papers? It is already being speculated that those commercial papers are from troubled Chinese real estate developers like Ever Grande. If this is true and correct then USDT has already fractionalized and might not have enough dollar backing to redeem all USDT in circulation.

[bbc.reporter]

First the regulators block them then they control them. Similar to what I have been telling everyone, the regulators will use the stablecoin issuers to control the cashflow and liquidity of what and how much goes in and goes out of the whole cryptospace market. I am not antagonizing everyone. I reckon if America also creates the same legislation and implements this with the European Union, I speculate the next bull market might not be as strong as the crypto bull markets we have witnessed during 2017 and 2020.



Dollar-pegged stablecoins might be blocked in the European Union’s 27 countries if the bloc’s new Markets in Crypto-Assets (MiCA) legislation enters into force in its current form.

The European Union’s landmark crypto law has already been approved but technicalities still have to be ironed out.

Blockchain for Europe and the Digital Euro Association this weekend sent a letter to the EU Council, a collegiate body formed by EU member states, in a bid to reverse controversial rules which would effectively quash any large stablecoin projects tied to anything but the euro.

The crypto industry says MiCA imposes restrictions on the issuance and use of stablecoins which aren’t denominated in euros or other official currency of an EU Member State.

This would possibly ban Tether’s USDT, Circle’s USD coin and Binance’s binance USD, which account for an enormous chunk of crypto trade volumes globally.

Source https://blockworks.co/eu-crypto-lobby-fights-mica-limits-on-us-dollar-stablecoins/

[takuma sato]

I would actually be an investor on the production on such a movie. Bitcoin is now so mainstream, and crypto in general, that it would be a guaranteed success. Michael Burry is now like a celebrity, at least in the investment world. While it would be a bit of a niche movie, there is an audience big enough that it would be profitable, and you don't need an huge budget for this since it wouldn't be some complex to shoot hollywood blockbuster.

I do think eventually Tether will go bust and someone will do a documentary on it. It would be the best buy the dip opportunity most people will ever get to see.

[estenity]

First the regulators block them then they control them. Similar to what I have been telling everyone, the regulators will use the stablecoin issuers to control the cashflow and liquidity of what and how much goes in and goes out of the whole cryptospace market. I am not antagonizing everyone. I reckon if America also creates the same legislation and implements this with the European Union, I speculate the next bull market might not be as strong as the crypto bull markets we have witnessed during 2017 and 2020.



Dollar-pegged stablecoins might be blocked in the European Union’s 27 countries if the bloc’s new Markets in Crypto-Assets (MiCA) legislation enters into force in its current form.

The European Union’s landmark crypto law has already been approved but technicalities still have to be ironed out.

Blockchain for Europe and the Digital Euro Association this weekend sent a letter to the EU Council, a collegiate body formed by EU member states, in a bid to reverse controversial rules which would effectively quash any large stablecoin projects tied to anything but the euro.

The crypto industry says MiCA imposes restrictions on the issuance and use of stablecoins which aren’t denominated in euros or other official currency of an EU Member State.

This would possibly ban Tether’s USDT, Circle’s USD coin and Binance’s binance USD, which account for an enormous chunk of crypto trade volumes globally.

Source https://blockworks.co/eu-crypto-lobby-fights-mica-limits-on-us-dollar-stablecoins/

probably not a good idea; in this case, stablecoins independent of fiat standards will appear. This would allow limited number of coins, rarity effect and FOMO.

after all, it was a basic idea for crypto innovation.

the genius has definitely escaped the bottle.