Aren't you afraid to store your bitcoins in stablecoins?

[sergiorus]

Snip
P.S. Tether (USDT) plans to conduct an audit (it's been promising to do so for the past five years) and will hire KPMG to audit the financial statements and PwC to review the company's internal quality control systems. What if the audit reveals "curious" nuances that could bring down this stablecoin? As a reminder, Tether has never conducted an audit in its entire existence, and it's unclear what's going on behind the scenes.

Thank you for reminding me sir, I have previously sold some of my bitcoins and kept them in USDT stablecoin until now, and it seems that the concern is indeed necessary to do, previously I divided it with 3 stable coins to keep unpleasant things like that, but the dominant in USDT seems like I have to move it again to another stable coin again so that the risk is also reduced, I need a stable coin in the re-accumulation stage at a falling price like now, I can't directly convert it directly to bitcoin because I'm doing DCA, so what I did by dividing it into several stable coins should be right to anticipate that fear.

Am just curious to know the wallet you use in saving all three different stable coins, because what I fear more than converting Bitcoin to USDT, is to save or hold them in a wallet that can also be affected by different things.

For now though, I try to have a little BTC and convert all remaining stablecoins to my local fiat currency because just as OP said, it would be better to be compensated or at least be able to rush to save my account from a major bank crisis, rather than wait on a stablecoin without a physical office to be available after undergoing auditing by KPMG because anything can happen.

if all stablecoins are on the same chain, or even on different, but EVM-compatible chains, it can be the very same wallet (i.e. Metamask, which also allows hardware wallets).
there are also multichain wallets, primarily mobile ones (i.e. Trust, Safepal) that can handle assets on many different chains in the same UI.

[Z_MBFM]

If someone wants to book a profit, then he must convert his Bitcoin or any other coin to a stable coin, this is normal. But I myself do not like holding stable coins for a long time. This is because we have seen a lot of things happen in the market in the past, so from that experience, no other coin can be trusted except Bitcoin. Because Bitcoin is the only one that no one can control, it has an authority to control everything else and they can change their foundation at any time. So in that case, I will not hold any stable coin for a long time, but it is definitely necessary for a short period of time.

[Furious 7]

It will probably be like that but indeed there are still a lot of investors who keep holding their assets and I was there even though we passed some ATH but I still kept my assets in bitcoin without selling. Let's say this is the most naive way I've ever done it because before I didn't do this but I want to hold for at least 2 or 3 halving periods now and this is my second period so I will still continue to buy without thinking of selling for the near future.

On the one hand storing in stable coins is actually not much different from fiat for me so it can not be an option or rather not interesting for me to do so I would rather continue to store my current assets in the form of bitcoin not replace with another especially if replace this for stable coin, I have no passion for it.

[Negotiation]

If someone wants to book a profit, then he must convert his Bitcoin or any other coin to a stable coin, this is normal. But I myself do not like holding stable coins for a long time. This is because we have seen a lot of things happen in the market in the past, so from that experience, no other coin can be trusted except Bitcoin. Because Bitcoin is the only one that no one can control, it has an authority to control everything else and they can change their foundation at any time. So in that case, I will not hold any stable coin for a long time, but it is definitely necessary for a short period of time.

Well said, I agree with you, because although other coins other than Bitcoin are somewhat stable and the profit is higher than Bitcoin. There is a lot of risk there, because after a while it is seen that all those coins are delisted from various exchangers. Those coins or tokens are suspended for transactions. In that case, those who invest face a loss. This is considered a loss for an investor. An investor loses his money here. In that case, I don't think there is anything better than Bitcoin.

[serjent05]

Let me repeat: how do you console yourself (calm yourself and drive away fear) when storing your assets (temporarily) in stablecoins? Remember the story with UST,  and LUNA in the Terra ecosystem?

It makes sense if people will convert BTC into stablecoins just to buy back when the price gets lower.  But if they just convert it to avoid price depreciation then buy back at the higher price, I think that is nuts.  Anyway, I am not convinced of converting my BTC to stablecoins just to escape the price volatility since we all know Bitcoin always bounce back.

In my opinion, storing assets in stablecoins is like "walking on very thin ice" - you never know when will fall through the ice.

I agree, Bitcoin is way stronger than those stablecoins, why take the risk when we all know Bitcoin will recover in due time and even give us more profit in the future?

[Churchillvv]

Personally, I don’t have any kind of trust for this stable coins but I use them anyways, the uncertainty in this crypto world is very much high so you just keep having that at the back of your mind but however, we have things that are highly risk and low risky, for stable coins, USDT has gain some kind of trust from people because of its backing but however, that doesn’t mean things can’t happen but the probability of it happening is very low. Most stablecoins that got de-pegged had nothing solid to rest its back on so they can but removed at any time but for USDT and USDC and a few others to have some issues like this their will definitely be panic so the chance of it happening is very low.

[KingsDen]

I am afraid of holding tether and other stable coins. That’s why I don’t hold them. I would rather hold btc and have unrealized gains there instead holding centralized usdt and get robbed by tether & co.

If you are willing to reduce your exposure to crypto or btc, tether is not the safe destination. For short term it might act alright but I wouldn’t wait usdt for more than a month. Way too risky.

I am sorry to ask...
Is having the part of my asset in tether that took risky?

Don't get me wrong, I got into this industry 2021, it's not that long but it's more than 4 years. I have heard so many rumours about the uncertainty and distrust of USDT, but 5 years gone nothing happened to it and it hasn't depaged. So, with the record and principle of bitcoin, I don't trust USDT but it doesn't mean anything is happening to the it. That's the largest coin after BTC by cap right.

When I was new, I lost a small amount trying to use Bist in order to avoid using Binance because it's gonna end any moment. But I'm sorry to say, binance is still here even after CZ was prosecuted. I am not saying it's good to hold funds for a long time in a reputable exchange like binance, but I'm saying it's not folding tomorrow.

[Zigabel]

Some persons may actually not be aware that this stable coins can actually end up this way and so they just think its some stable representation of the USD and as long as the USD is in existence, they will still have their fund safe storing it as USDT. this is why as a crypto enthusiast you should be always open to learning and never stop learning, always keep making research to understand the crypto ecosystem much more so you will not be a victim of circumstances.

This thread will even educate some people who are not aware of this and open their minds to better way of Holding their assets in bear period as this. Not all Hold their assets in stable coin because they trust the coin so well and are not scared, some do it out of ignorance and the limited knowledge they have about the dynamics of such and so they are working within the information they have available to them not exactly from actual Trust.

[sunsilk]

If I have no plans of buying back the bitcoin's I've sold, I won't keep it in stable coins and I'll keep it just the same in Bitcoin.

But, if I take profit and will also plan to buy back some in the near future when the drop comes. There's no other option for us but to stay it on a while with a stable coin.

The risk there and it's a part of it but we've got no other choice or if we do, we have to choose the stable coins that are like DAI.

[macson]

I don't think these people really thought about the risks. They were simply concerned that USDT hadn't experienced any serious issues so far, and it was the easiest way for them to convert their Bitcoin and store it in US dollars. If they had realized from the start that holding USDT long-term was riskier because it could run into problems at any time, they would have avoided it and kept their Bitcoin.

[Josefjix]

Terra USD was backed by LUNA, which was backed by nothing. They did have a reserve of Bitcoin to try and protect the peg, but its total value was much smaller than the amount of UST in circulation. Tether’s USDT is presumably fully backed and isn’t some untested experimental ponzi. There are definitely still risks with USDT, but there isn’t the same level of worry that it might suddenly collapse.

If USDT were to depeg, that would create an arbitrage opportunity where people can buy it for less than $1 and then redeem it for its full value. Eventually, this arbitrage should bring it back to $1. The fact that it hasn’t collapsed or depegged for a prolonged period gives people confidence that it actually has full backing.

Yeah, UST was very different, USDT is more about backing and trust. It’s held up so far, which is why people still use it, even on platforms like bitcoinbetting.

I can't tell what root USDT is backing on, but I can say, it's the safest stablecoin so far. Why I am truly believing in it is because USDT had been in the game from day one, from the beginning of crypto and it's had been in existence since then either audit had been done or not, USDT had been the game changer.

I cannot blindly trust USDC, DAI and other stablecoin out there, I don't know how strong they may be, but I won't convert my Bitcoin into them.

[suzanne5223]

I've seen posts from some users who sold their crypto assets (bitcoin) in anticipation of the upcoming market falls. Or those who sold their crypto assets (bitcoin) earlier with profit, at $100k+. I assume most converted to stablecoins like USDT and others. I have a question for these users. Aren't you afraid of keeping your assets in USDT (a centralized financial services like a bank) for the entire bitcoin bearish period, which, as usual, lasts several years, meaning quite a long time, for the subsequent purchase of bitcoin.

To take profit as a Bitcoin holder, there's no way we won't deal with stablecoin at some point, and the same thing applies to you unless you want to sell your BTC at a low price, which is something that happened to me weeks ago when the market suddenly downtrended and I learned a pretty good lesson.
Having said that, USDT is not the stablecoin we have in the market, though it's the most popular and most used, but when we said stablecoins, we are technically talking about all stablecoins in the market, and for the record, it's not all stablecoins that are centralized.

Stablecoins is fundamentally no different from a bank, but in this case, "depositors" are less protected (at least in banks, deposits are insured and will be compensated by the state in case of force majeure, in theory)? Stablecoins could collapse, go bankrupt, i.e....anything could happen.

Let me repeat: how do you console yourself (calm yourself and drive away fear) when storing your assets (temporarily) in stablecoins? Remember the story with UST,  and LUNA in the Terra ecosystem?

Honestly, the collapse of UST is clearly written for those that can see it right from the beginning because 99% of all stablecoin claims to be backed by BTC are hype, and that's i never trust the UST concern nor do i hold LUNA.
I prefer a stablecoin that was created by a reputable DeFi platform whose model of operation is quite different from centralized platform and traditional system operation.

In my opinion, storing assets in stablecoins is like "walking on very thin ice" - you never know when will fall through the ice.

Stablecoins are not an asset, and there's no way anyone can store an asset in it once they have already taken profit from their BTC investment.

P.S. Tether (USDT) plans to conduct an audit (it's been promising to do so for the past five years) and will hire KPMG to audit the financial statements and PwC to review the company's internal quality control systems. What if the audit reveals "curious" nuances that could bring down this stablecoin? As a reminder, Tether has never conducted an audit in its entire existence, and it's unclear what's going on behind the scenes.

USDT getting PwC to help strengthen internal systems and help in making preparations for their audit could mean they have nothing to be panicked about. Besides, i hear a rumor that they have conducts a full audit this month with KPMG.

[kawetsriyanto]

I've seen posts from some users who sold their crypto assets (bitcoin) in anticipation of the upcoming market falls. Or those who sold their crypto assets (bitcoin) earlier with profit, at $100k+. I assume most converted to stablecoins like USDT and others. I have a question for these users. Aren't you afraid of keeping your assets in USDT (a centralized financial services like a bank) for the entire bitcoin bearish period, which, as usual, lasts several years, meaning quite a long time, for the subsequent purchase of bitcoin. Stablecoins is fundamentally no different from a bank, but in this case, "depositors" are less protected (at least in banks, deposits are insured and will be compensated by the state in case of force majeure, in theory)? Stablecoins could collapse, go bankrupt, i.e....anything could happen.

I don't see anything wrong that people take profits or convert their BTC to USDT temporarily. As the investors, there should be the selling target or profit target. If it hits the target, IMO selling for profits is the best choice. Don't you hold Bitcoin for dreaming certain profits, too?

By the way, people convert their BTC to USDT when BTC price is in high rate due to securing the profits and prepare bigger funds to buy again. There will be no endless uptrend, there must be downtrend. If we always keep the Bitcoin, how we prepare the funds for accumulating again in the downtrend (bearish season)? Not everyone has enough money from their regular income to buy Bitcoin. Some people may have no additional funds to buy again. So they need to sell their Bitcoin to have the money for accumulating again.

You're right. Stablecoins can go bankrupt or collapse. Even BTC can collapse, too. However, it is unlikely to happen immediately considering its huge market caps and many people are involved in them.

[RagnarTheThunderer]

I don't think these people really thought about the risks. They were simply concerned that USDT hadn't experienced any serious issues so far, and it was the easiest way for them to convert their Bitcoin and store it in US dollars. If they had realized from the start that holding USDT long-term was riskier because it could run into problems at any time, they would have avoided it and kept their Bitcoin.

A lot of people actually treat stablecoins like "safe cash", but they forget its still independent on the issuer. With USDT, you're trusting the company behind it, not the just the blockchain.

Another issue is access, even if your funds are stable, you still rely on platforms to move or withdraw them. If withdrawals get paused or restricted, you might not be able to use your money when you need it. Unlike bitcoin, where you control and transfer it anytime from your wallet.

From what I've seen, stablecoins are fine for short-term use like for trading or moving funds but risky for long-term storage.

[d5000]

Stablecoins is fundamentally no different from a bank, but in this case, "depositors" are less protected (at least in banks, deposits are insured and will be compensated by the state in case of force majeure, in theory)?

Maybe an alternative for some people could be stablecoins issued by more traditional financial institutions with a banking license. An example is the EURCV/USDCV by Société Générale (a big French bank) or the A$DC by the ANZ Bank (Australia). (Edit: see here for a complete list in 2025).

It is important to remind however that these stablecoins aren't protected by deposit insurance (e.g. the famous 100,000 EUR insurance in Europe). So if the bank goes bankrupt, the funds may be gone. They may be safer than Tether and other stablecoins issued by fintechs with no banking license however, because banks normally have a big portfolio of different investments and thus their stablecoin will normally not collapse in a crypto-related event as long as the rest of the bank's business does fine.

For example, Tether may collapse if crypto goes through a severe crypto winter with drastically decreasing demand for stablecoins making their operations unsustainable. Bank-issued stablecoins instead would not be affected that much, as long as the crisis is limited to the crypto sector. (At least Tether has some diversification however, for example they're also invested in the agrarian business.)

Personally I only store small amounts in stablecoins, those that I also would store on a CEX (as some have mentioned, both cases are very similar regarding risk).

[BlackHatCoiner]

This is a good take, and I've thought of it. The scenario that the stablecoin crashes, like LUNA, is one concern. The other concern is that... You don't know when bitcoin goes back up. We can all confidently say things like bear market, when we are already in a bear market, but what when we no longer are? Can you really predict when it goes back to $100k, and you sold it at $70k?

Many people have regretted selling bitcoin for fiat, with the hopes of getting back lower. I can't say the same for HODLers.

[hd49728]

This is a good take, and I've thought of it. The scenario that the stablecoin crashes, like LUNA, is one concern.

Stablecoins can have depegs, crashes like Terra USD (UST) or stablecoins in our wallets can be frozen if governments want or if stablecoins company receive reports and take action or they do it all by themselves without any report from their company users or request from governments.

The other concern is that... You don't know when bitcoin goes back up. We can all confidently say things like bear market, when we are already in a bear market, but what when we no longer are? Can you really predict when it goes back to $100k, and you sold it at $70k?

Many people have regretted selling bitcoin for fiat, with the hopes of getting back lower. I can't say the same for HODLers.

In this market, it's better to invest, don't trade, don't speculate the market. It's always very difficult to time the market for finding right times to enter or exit the market with bear market price or all time high price.

Many people want to outsmart the market and they can succeed some times but after all they lose their bitcoins by selling lows, buying higher prices. When Bitcoin takes off, it's simply too late to take quick enough action and buy it back for getting similar amount of bitcoin like you sold. It's very opposite with their plans when selling bitcoins as even they want to do the right things like buying bitcoin again, no guarantee that they will have better price for buying it.

[BlackHatCoiner]

Stablecoins can have depegs, crashes like Terra USD (UST) or stablecoins in our wallets can be frozen if governments want or if stablecoins company receive reports and take action or they do it all by themselves without any report from their company users or request from governments.

Absolutely. Very few understand it, but USDT is just like a trojan horse for Central Bank Digital Currency. Since most activity in Tether is KYC-ed, Tether can connect almost every balance to a real world identity with the help of chain analysis.

In this market, it's better to invest, don't trade, don't speculate the market. It's always very difficult to time the market for finding right times to enter or exit the market with bear market price or all time high price.

I mean, it's just risk. It's been around for a while in markets. You can risk for more money. People don't understand risk, and think that selling it high and buy back lower comes with no risk.