Usdt tether buying btc the USDT might decouple of real USD

[Waldorf77]

Tether buying btc to back up USDT with valued asset.
It can only means that USDT might decouple of the USD.
Could be Bretton woods moment here.
The next year we could see USDT value against USD will grow.

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I have heard about this few months ago and I can remember that we discussed about it on this forum at the time. Tether gold just few amount in bitcoin and hold most of its asset in treasury bonds.

Tether's holdings of U.S. Treasury Bills hit $55.8 billion, up 5.2% from the end of March, while non-U.S. Treasury Bills rose to $62.9 million, up more than 30% from the previous quarter, the report said.

Tether also counts $115 million of corporate bonds, $3.3 billion of precious metals, $1.7 billion worth of bitcoin, $5.5 billion of secured loans and $2.4 billion of unspecified "other investments" in its holdings.

The recent news about Tether is the bitcoin mining business that the company want to start with 500 million or something like that.

https://www.bloomberg.com/news/articles/2023-11-16/stablecoin-issuer-tether-usdt-btc-wants-to-become-a-major-bitcoin-miner#xj4y7vzkg

[electronicash]

it's like USD backed by BTC. makes sense just as they backed USD with gold back in Brettonwoods. The US government has more than 200K BTC and they could buy more from coinbase after all Blackrock is already an investor in that company so they could back the USD with BTC.

that would be an interesting development, i have heard of this before i think from Raoul Pal who said BTC was created after the 2008 collapse. BTC is meant for this.

[franky1]

when banks were buying bonds at 2%.... then bonds went to 4% no institution wanted to buy the 2% bonds for the bearers to cash out.. which caused them to have to sell bonds below 1:1 to tempt buyers.

this caused many banks to get in trouble. so investing in fiat bonds didnt work out well. however bitcoin can have down times too. so a fair balance of bonds and btc to hedge each other to know which to sell first to get best cash access is smart.

[bluebit25]

I'm not sure how it is influencing but with stablecoins its main function will still be demand leading to investment in many other things in the exchange market.
But USDT is always confused after many crisis events taking place in the market. Although we all understand the importance of stablecoins in this market, there are also many different fiat options. Many times I remember only caring about the local Btc/fiat exchange rate, but perhaps the fear of many people about conspiracy in this market only adds to the drama before we reach the new phase of the market.

[DVlog]

Tether buying btc to back up USDT with valued asset.
It can only means that USDT might decouple of the USD.
Could be Bretton woods moment here.
The next year we could see USDT value against USD will grow.

This can be true and some YouTubers are considering USDT as a ticking bomb that can shake the industry. The most alarming thing IMO is the raising of the USDT market cap when most of the other stablecoins are losing their market caps. It is because USA banks are not supporting reedming USDT. So if this issue has never been solved how USDT will overcome it will be a sight to behold. The SEC also said that any company outside of the USA can not issue stablecoin back in USD by using a US bank.

[o48o]

Tether buying btc to back up USDT with valued asset.
It can only means that USDT might decouple of the USD.
Could be Bretton woods moment here.
The next year we could see USDT value against USD will grow.

Thy would usdt be more valuable then USD? That doesn't make any sense. It might go down though.

I get when companies are doing speculative investing, as they are accepting the risk by doing so. But when the they are doing it with a purpose to back up a price pegged asset, shouldn't all the backing be done with the same value in the first place? I seriously don't get this. I guess there are no laws requiring them to do this as banks aren't doing it either. But when banks crash, customers are often protected by goverments when they bail them out. Tether is just playing a dangerous investing game to max their profits imho

[boyptc]

Tether buying btc to back up USDT with valued asset.
It can only means that USDT might decouple of the USD.
Could be Bretton woods moment here.

This is what Do Kwon and associates did to Luna. They've bought BTC to backed their project (Luna) and we've seen what happened next to their project affiliates which includes their UST.

The next year we could see USDT value against USD will grow.

It is tied to USD and that's why I don't think that it's going to be against with each other. But if there can be scenarios that are going to happen, the more likely to happen is the devaluing or depegging of it to USD.

But are we going to see that? I don't think so, it's the most used stable coin and many prefer it so depegging is unlikely.

[franky1]

instead of just reserving dollar as liquid cash to match the token.. by taking dollar and investing it hoping to make profits with peoples money. that is where things can start to go wrong. especially if they can't close those investments quickly/to break even. this is them playing the fractional reserve game because not all dollar is in reserve. its in investments

[FinneysTrueVision]

Being overcollateralized because the value of BTC goes up doesn't mean that Tether will decouple from the dollar. It will just make their peg stronger. If the opposite situation happened and the BTC price fell so much that the issued amount was a lot higher than what was in their reserves then that definitely would have a negative impact on their peg. It happens often with algorithmic stablecoins when the collateralization ratio starts to get really low.

[pooya87]

Tether buying btc to back up USDT with valued asset.
It can only means that USDT might decouple of the USD.

The main purpose of centralized shitcoins like tether is still to be used by day traders and the biggest chunk of the volume still goes into altcoin market. There is not enough bitcoin to be bought to back tether.

Could be Bretton woods moment here.
The next year we could see USDT value against USD will grow.

Unlikely because dollar got its value from United States exerting its power over the rest of the world and forcing others to use it. Tether does not have the same power, not just that we consider it to be a centralized shitcoin so its value can not rise.
Not to mention that the only reason why anybody were using this shitcoin was its stability, if it stops being stable (1:1 with dollar) it stops serving its main purpose as I said at the start meaning it would dump hard.

It may have taken 30-40 years for dedollarisation to speed up but it won't take nearly as long for detetherisation to begin

[Davidvictorson]

when banks were buying bonds at 2%.... then bonds went to 4% no institution wanted to buy the 2% bonds for the bearers to cash out.. which caused them to have to sell bonds below 1:1 to tempt buyers.

this caused many banks to get in trouble. so investing in fiat bonds didnt work out well. however bitcoin can have down times too. so a fair balance of bonds and btc to hedge each other to know which to sell first to get best cash access is smart.

Simply put Tether's move is showing that they are gradually reducing their reliance on the banks. Because should anything happen to the us Treasury bills it will affect them too.
Tether already knows the high risk involved if they rely on a single asset reserve therefore I see their diversification as thinking way outside the box. 

[franky1]

when banks were buying bonds at 2%.... then bonds went to 4% no institution wanted to buy the 2% bonds for the bearers to cash out.. which caused them to have to sell bonds below 1:1 to tempt buyers.

this caused many banks to get in trouble. so investing in fiat bonds didnt work out well. however bitcoin can have down times too. so a fair balance of bonds and btc to hedge each other to know which to sell first to get best cash access is smart.

Simply put Tether's move is showing that they are gradually reducing their reliance on the banks. Because should anything happen to the us Treasury bills it will affect them too.
Tether already knows the high risk involved if they rely on a single asset reserve therefore I see their diversification as thinking way outside the box. 

a bank account is only federally insured for a few hundreds thousand. not millions.. so yes many would invest the other billions in things like bonds to ensure it against bank runs.. however when investments go bad de-pegging can happen if they cant unlock the investments to make the dollar balance whole if large investors decide one day to withdraw real fiat from tokenised fiat..
some services will put 72 hour holds on balances of a certain size. but even a 3 day hold wont recoup losses if a bad investment went bad