Bitcoin hits new record of $50,000 -

Cool Dog

A goodboi denied his Wendy's
kiwifarms.net
If a stablecoin is not properly backed (and now we know that at least USDT wasn't backed 1-to-1 in 2017-2018, see their settlement agreement. And they haven't provided complete audit since then), it'll create digital "bank run" when people will get scared and decide to cash out. At first, exchanges/token issuers will impose redemption limits in hope of waiting out liquidity crisis. If the panic continues, desperate people will start buying crypto with stablecoins, so they can later sell that crypto for USD. As a result, crypto priced in stablecoin will skyrocket, while the price nominated in USD will plummet. This will drive the market further into the ground as the trust in "1-to-1 peg" is lost. At this point, exchanges/issuers will face a choice: to become insolvent and hold their customers' bags filled with useless stablecoins they can't redeem, or enter damage control mode, freeze customers' wallets and buy tickets to an undisclosed island in Caribbean. Given the fact most of them are already located on said islands, what makes you think they will choose the first option?

This is the worst case scenario, of course. Some stablecoins may survive the crash, you should be looking for those that comply with US regulations.

Archive
Tether and Bitfinex had a settlement with NY AG. They shall pay $18.5 mil in fines, can't do business in NY and shall provide regular financial reports.
Naturally, they started bragging on Twatter:
Archive
The agreement itself is an interesting reading. I'm not a lawyer, but that's what I was able to extract from that:
1) The AG office looked into events that took place from 2017 to 2019.
2) From June to September 2017, 446 mil of USDT were backed by $61 million.
3) After growing concern, Bitfinex and Tether requested an audit in June 2017.
4) Conveniently, missing $382 million were transferred to newly made Tether bank account from Bitfinex so auditors can verify it.
5) Tether shat out "transparency update" with convincing numbers obtained from auditors.
6) Audit was never completed after that.
Summary: Tether had issued misleading report, omitting the fact USDT was not fully backed by USD from June to September 2017.
Also, in 2018 Tether was lending money to Bitfinex without disclosing or collateralizing the debt, because Bitfinex fucked up and got $900 mil seized on third-party accounts. Later, Tether ninja-edited its ToS to accommodate the changes in Reserves policy.

So, despite Tether's claims on Twitter, they DID break the law and they're not off the hook yet. First, they have to provide regular reports to NY AG office for the next 2 years. Given that Tether is allergic to auditors, I doubt they will ever send anything. Second, nothing prevents federal agencies from investigating Tether, using this case as a jump-start. But this settlement gives Tether a much needed time either for exit scam or for getting their shit together :optimistic:.
Overall, happening is cancelled, heads aren't gonna roll just yet.
Yea I get it, tether was always a bitfinex scam but what about other stablecoins like DAI?
 

tulskij_tochnyj

I identify as a rifle
kiwifarms.net
Would you say BUSD (Binance USD) is a good one to start using instead? Supposedly unlike Tether it is NYDFS-approved and audited at least once a month with reports made publicly available.
Well, US-based part of Binance (Binance.US, BUSD and their partner Paxos) seems OK. After all, that's their poster child (archive) made to divert regulators attention from off-shore entities.
Yea I get it, tether was always a bitfinex scam but what about other stablecoins like DAI?
I was talking about stables backed by fiat. I know very little about DeFi stablecoins.
 
  • Informative
Reactions: 419

Vecr

"nanoposts with 90° spatial rotational symmetries"
kiwifarms.net
That's not exactly right, if you are long of 5USD GME or 1000USD XBT, it's probably okay, you have enough time to get out if a major issue happens.
 

Sweet and Savoury

Null-like homunculus
kiwifarms.net
I'm not into Bitcoin myself but even as a normie I've notice a large uptick in anti-Bitcoin articles flowing out of the usual suspects in the last few weeks. Obliviously the big boys have taken notice of crypto and are gearing up to do...something.
 

Super-Chevy454

kiwifarms.net
I'm not into Bitcoin myself but even as a normie I've notice a large uptick in anti-Bitcoin articles flowing out of the usual suspects in the last few weeks. Obliviously the big boys have taken notice of crypto and are gearing up to do...something.

Styx bitchuted about the same thing.
https://www.bitchute.com/video/pphgXkpfRFFw/

One bitchuter dropped some food for thoughts.
Rockhopper
It’s simple reverse psychology. Tell people they can’t have it and everybody wants it. Bitcoin is a Trojan horse for a cashless society. It pays out it in fiat currency
 
Top