Thread: Ethereum
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Old 24th January 2018, 20:46     #153
Ajax
Architeuthis
 
Quote:
Originally Posted by Lightspeed
It's like that whole Pizzagate nonsense.
It's really not similar at all. Nobody is questioning the technology behind Tether. The issue is whether it's really backed 1:1 by over 2 billion US dollars in a bank - which is fundamental to the Tether promise.

Problems:

1. Tether refuses to be audited - to guarantee they have the money - despite promising as such on their website. This is a massive red flag. They also won't say who their bank is.
2. Tether's connection to Bitfinex was unknown until the leak of the Paradise Papers.
3. At least one of Tether's owners/directors is a convicted fraudster.
4. Tether is releasing hundreds of millions of new tokens into the market on a near-daily basis. Each of these is supposed to be worth US$1.
5. Following the blockchain trail shows most of these tokens are being funneled directly into Bitfinex.
6. Bitfinex has been proven to engage (or allow) enormous amounts of wash trading.
7. Tether themselves will not exchange USD for their tokens. They are selling tokens but never buying. I believe the only exchange where you can cash out Tether is Kraken.

I could go on. Ultimately, if Tether is backed by fiat then everything is legit. At this point that seems highly unlikely.

It's not an issue of Eth vs BTC or whatever. If Bitfinex and Tether implode, it will create a liquidity crisis in which nearly everyone will want to sell and nobody will be able to cash out. It would ruin the market for years.

Last edited by Ajax : 24th January 2018 at 20:48.
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