Stick with bitcoin and stay away from centralized crypto, especially stablecoins

[Pmalek]

Tether froze over $180 million in USDT across five wallets on the Tron blockchain a few days ago. It's believed that those wallets are connected to Venezuela, that used USDT for oil trade and to evade US sanctions. It's reported that 80% of Venezuela's oil revenue is settled in USDT. And what happened? US political interests happened, and that resulted in Tether freezing the addresses.


Source: https://finance.yahoo.com/news/tether-freezes-182m-usdt-largest-105442400.html

The lesson is clear. You don't own centralized stablecoins. You co-own them with the issuer. An issuer that can remove you from the equation at any time. Stablecoins can be a very dangerous double-edged sword, and the way they work is very different from bitcoin.

It's not freedom money if there is a governor that can take it from you. It's just a new form of the petrodollar, where the same powers can pull the strings.

But Bitcoin doesn't have an issuer. Transactions settle every 10 minutes without asking the "Bitcoin Board of Directors" or the "CEO" if it's ok. Orange presidents can't call the "Bitcoin Security Department", threaten them with tariffs, and request a rollback or a freeze. The blockchain doesn't care who you are or who your political alliances are. Nodes don't discriminate, and only make sure that the rules are being followed.

It's that simple to achieve financial freedom. If you do it right, no one can steal your money from you. Well, they can if they invade, capture your President, and... Oh!


Rant over!

Use Bitcoin. Everything else is secondary. We don't need any more examples.         

[Emjay24]

Everyday we see more reasons to stay away from centralized assets. It is a shame though that Tether sold its integrity for political interests but it is expected since it has a central control and Trump has defined illegal funds in his own selfish political terms and Tether responded accordingly.

The effectiveness of decentralization cannot be overemphasized, Bitcoin remains the best way to protect your funds from such government manipulations and control. Another win for Trump and loss for Venezuela, this time targeting their finances.
Everyone is encouraged to cling to decentralization and self custody that is inherent in bitcoin because the government and institutions are never to be trusted.

[buwaytress]

There you go. This is the scenario I bring up every now and then. Just because it's outlandish and unlikely doesn't mean much when it is possible. Mind you,  there are so many networks out there who claim decentralised but are just as open to government intervention as Tether.

Building on Tron? Ethereum? Oh, believe me, you are not as free to build as you might believe.

[_act_]

I hope bitcoin will gradually become less volatile in the downward direction but increasing more in price, people will have more confidence to use it instead of this shit coins called stable coins.

Everyday we see more reasons to stay away from centralized assets

This is no more new at all, it is common both with USDT and USDC. As Tether is freezing USDT every year, also is Cycle seizing USDC every year. We have just started this year, we are going to see more of related news later in the year.

[henry_of_skalitz]

There you go. This is the scenario I bring up every now and then. Just because it's outlandish and unlikely doesn't mean much when it is possible. Mind you,  there are so many networks out there who claim decentralised but are just as open to government intervention as Tether.

Building on Tron? Ethereum? Oh, believe me, you are not as free to build as you might believe.

You are free till the moment you are inconvenient for them.

[Rashlyowl]

Time to time, the strangeness of centralized institutions hiding behind the 'decentralization' word is increasingly revealed, people will realize the important role of BTC, why they should own & use BTC. As far as I know, Venezuela is one of the countries where crypto developed quite well in its early days. I still wonder, with a good understanding of decentralization, they should be using BTC as transaction medium, so why are they using Tether?

[348Judah]

Tether froze over $180 million in USDT across five wallets on the Tron blockchain a few days ago. It's believed that those wallets are connected to Venezuela, that used USDT for oil trade and to evade US sanctions. It's reported that 80% of Venezuela's oil revenue is settled in USDT. And what happened? US political interests happened, and that resulted in Tether freezing the addresses.


Source: https://finance.yahoo.com/news/tether-freezes-182m-usdt-largest-105442400.html        

What does all these suggest, that even if it were to be bitcoin, users will also be affected in the same manners once they are using it from a custodial storage like that of a centralized exchange, we have to be careful these days, when we have asset that worth thousands or millions, we should avoid the use of a custodial storage for them, very soon, these may also extend to all exchanges users for one reason or the other, we should learn before it becomes too late for us.

[Natalim]

This is what people really need to understand. Bitcoin should be the only coin you truly trust. Other coins, stable altcoins, sure they’re gaining popularity, but once there’s an issue and they can freeze it, that’s basically the end of your money.

The fact that funds can be frozen even on suspicion alone already makes it unsafe. Imagine you’re just doing a normal P2P transaction, then it turns out the wallet you interacted with was linked to something illegal. You get dragged into it even if you did nothing wrong. Suddenly your funds are frozen.

That risk already exists, and it’s something a lot of people underestimate when dealing with stablecoins that are regulated.

[PrivacyG]

I remember when years ago this was only a theory.  USDT was known to have this in the code but no body knew if it was ever applied or if it ever will.

So this was another lesson for me.  If there are signs things can go bad, expect the worst.  Yes, for a decent amount of time USDT was used pretty much with no limits.  Or at least no limits that the average person knew of.  But the code was always there and when the right time came, they started applying it.  After all, it is not there for no reason.

You all should also consider this when it comes to the Exchanges you are using and any other Services you are offered.  Even your Smart phone or computer.  If the Exchange has a 'Know Your Customer' clause, expect that it will apply one day on your account as well.  If the computer you own has an 'Artificial Intelligence' that your Operating System and its manufacturer begs you to understand it only stores and processes things locally, expect that one day it will be connected to the Internet and possibly used against you.

In other words.  In the same way you would not Trust a random stranger to hold your Money in their purse for you, do not Trust a Third Party to do it for you either and expect that the things they do and offer may not always be in your best interest.

[9ja Amaka]

This is what everyone should know by now. Does it mean the Venezuelan governments cannot hire a Crypto Enthusiast who is professional enough to advise them on the disadvantages of leaving asset in a centralized platform.

You see the problem with third party platforms, they will always be a snitch. Especially when the US government has made a bargain with them on what benefit they will get if they snitch.

[goldphysicalbitcoin]

At its current stage, Bitcoin is still not sufficient to function as an everyday medium of exchange. Its market capitalization is too small, which leads to large price volatility, and the supporting infrastructure still needs further development.

When Bitcoin’s market capitalization reaches or surpasses that of gold, and the entire financial system begins to account in satoshis, volatility will naturally decline. At that point, it may well become the world’s only sound money.

[bhadz]

It's reported that 80% of Venezuela's oil revenue is settled in USDT. And what happened? US political interests happened, and that resulted in Tether freezing the addresses.

That's a lot of percentage from their oil there and if it's put into USDT, easy for Tether to freeze it.

Use Bitcoin. Everything else is secondary. We don't need any more examples.         

I agree, nobody can freeze Bitcoin unless someone has intentionally deposit their Bitcoins into a centralized exchange. But if not and kept to their own personal wallets, there is no one that can freeze them.

Does it mean the Venezuelan governments cannot hire a Crypto Enthusiast who is professional enough to advise them on the disadvantages of leaving asset in a centralized platform.

I think that each government now has their staff who has at least basic knowledge about how to transfer, deposit/withdraw cryptos.

[Lucius]

~snip~
But Bitcoin doesn't have an issuer. Transactions settle every 10 minutes without asking the "Bitcoin Board of Directors" or the "CEO" if it's ok. Orange presidents can't call the "Bitcoin Security Department", threaten them with tariffs, and request a rollback or a freeze. The blockchain doesn't care who you are or who your political alliances are. Nodes don't discriminate, and only make sure that the rules are being followed.         

It's not as simple as it seems, because you should keep in mind that at least a third of the hash power is located in mining farms located in the USA, and that although BTC transactions cannot be frozen, as is the case with most so-called stablecoins, they can be rejected by the mining pool, or the coin addresses from which they are sent can be blacklisted.

To make the situation even worse, let's not forget that the greatest peacemaker and that Chinese scumbag became very good friends overnight, which means that he will do whatever is asked of him, and I have no doubt that every other major CEX operating in the US will do the same.

By the way, a country trying to avoid US sanctions used a stablecoin from a company located in the US - really genius

[Alone055]

I think the reason why most people keep their money in USDT or stable coins is because they want to keep them safe from the volatility of the market, which means that if you buy Bitcoin when it's at $50k, using USDT, and then you sell them when it reaches $100k, and now you don't want to buy something else with that money because you have plans of buying Bitcoin again, and you will do that in the bear market, so in this situation, you have no choice but to keep holding the stable coins you have since that is the only way you can maintain the value of your investment capital because stable coins don't lose value.

Even though I agree that we can't trust any other cryptocurrency than Bitcoin when it comes to such matters, but I also want to ask, what should someone in a situation I mentioned above do? If you are an investor who keeps holding constantly and only takes profit in between and convert that directly into fiat, but if you are someone who buys low, sells high, and buys low again, in this situation, you can't keep converting your funds to fiat and then to a stable coin every time you see an opportunity to buy. So basically, people don't have a reliable source when it comes to stable coins, but it's a necessity. We really need a decentralized stable coin, if that could be possible.

[hd49728]

Tether froze over $180 million in USDT across five wallets on the Tron blockchain a few days ago. It's believed that those wallets are connected to Venezuela, that used USDT for oil trade and to evade US sanctions. It's reported that 80% of Venezuela's oil revenue is settled in USDT. And what happened? US political interests happened, and that resulted in Tether freezing the addresses.

It's stablecoin Tether, and many other stablecoins have the same risk. It happened in the past, it just happened days ago and it will appear in the future as altcoin blockchains are centralized and most stablecoins are centralized as well.

PSA: Most stablecoins can be frozen, even in your own wallets.
Stablecoin blacklists: How they work and who controls them.
Stablecoins and blaclists.

Use Bitcoin. Everything else is secondary. We don't need any more examples.         

bitcoins can not be frozen in your non-custodial wallets. Bitcoin is unique and governments can not freeze your coins if you store your coins in non custodial wallets.

[Cookdata]

This is what everyone should know by now. Does it mean the Venezuelan governments cannot hire a Crypto Enthusiast who is professional enough to advise them on the disadvantages of leaving asset in a centralized platform.

You see the problem with third party platforms, they will always be a snitch. Especially when the US government has made a bargain with them on what benefit they will get if they snitch.

Hire who? A government hire a professional to do what? Use decentralize asset? You think government will ever think of such.

There absolutely nothing wrong in what Venezuela government did, many companies and organizations use Tether because they don't want an affiliate with decentralize, probably afraid of the beasts they created. However, what we don't know about Venezuela is the link between Maduros and the oil settled in USDT. If the US government want the money be diverted, to them then this is a lesson to other countries that have beef with US government and are affiliated with Tether shitty stable coins to move their assets to avoid future occurrence.

The government motives could be because of of fear of Bitcoin volatility and perhaps easy use since it's one of the most used stablecoin but the fact that many asset are frozen on under Tether smart contract should send a warning to everyone that has asset tether's smart contract.

I'm wondering how gullible the Venezuela government and the cabals are really active. When a president is moved and illegally detain in another country, the first thing to do is to check weakness but they were busy making appearances on media trying to do some damages. This is what you get when you employ incompetence in your government, bunch of illiterates.

[Pmalek]

Building on Tron? Ethereum? Oh, believe me, you are not as free to build as you might believe.

There are different decentralization levels in altcoins. Since you mentioned Tron and Ethereum, the latter is more decentralized than the former, but both still serve the interests of powerful individuals and organizations. Ethereum proved that many years ago with its blockchain rollback. 

I hope bitcoin will gradually become less volatile in the downward direction but increasing more in price, people will have more confidence to use it instead of this shit coins called stable coins.

It's going to take a long time for that to happen, in either direction. We can't expect Bitcoin with its tiny market cap to perform similarly to an asset with much bigger market cap (I am looking at you gold).

[cr1776]

...

The lesson is clear. You don't own centralized stablecoins. You co-own them with the issuer. ...

Use Bitcoin. Everything else is secondary. We don't need any more examples.         

Exactly.  Almost every cryptocurrency except bitcoin has risks like this. Look at Eth vs classic.  And not to inject anything controversial here, but this shows how "filtering" could result in "filtering" transactions - it is the camel's nose under the tent.  :-)

[_act_]

It's going to take a long time for that to happen, in either direction. We can't expect Bitcoin with its tiny market cap to perform similarly to an asset with much bigger market cap (I am looking at you gold).

You are right about this, but the marketcap keeps growing. A time will later come that the marketcap will be huge, more institutions will invest in bitcoin while the institutions will defend the price in a way bitcoin will be seen more as a store of value just like gold. Bitcoin was volatile than this before but becoming less volatile gradually. Also more countries will later invest in bitcoin.

[promise444c5]

Use Bitcoin. Everything else is secondary. We don't need any more examples.         

I agree, nobody can freeze Bitcoin unless someone has intentionally deposit their Bitcoins into a centralized exchange. But if not and kept to their own personal wallets, there is no one that can freeze them.

I get your point, but to make it even more clear to readers, it’s the account (with only figures) that gets frozen through the C.exchange, not the Bitcoin.
The Bitcoin will still be sitting in the exchange's self-custody wallets.

Also,while it can’t be frozen, there are other ways to lose your Bitcoins too and  wallet is part of it..so the personal wallet should be  a trusted, open-sourced, self-custody wallet.

By the way, a country trying to avoid US sanctions used a stablecoin from a company located in the US - really genius

That’s what happens when they refuse to stay informed..