As a committed lover of drama, I've been steadfast in getting my updates on Tether now for about a year. If Tether breaks, and BTC and ETH go down to $500 and $5, we're looking at a kind of dramahappening unlike anything we've seen since 2016. The fact that people will lose everything means that this level of fallout could surpass 2016 election night.
Say a BTC is worth 40,000 in USD, but all I have is Tether, and I can offer you 40,000 of them. That's the agreement right now; but if it's revealed that a Tether... isn't even worth nearly a cent, then what is that BTC you bought going to be resellable at? Prolly not $40,000
Isnât BTCâs value free floating and tetherâs value âpeggedâ to USD. I still donât understand how tether imploding will effect anything else other than undermining the faith of the crypto market as a whole
So much of the liquidity involved with BTC, ETH, and DOGE is Tether. Tether's the on-ramp and off-ramp for most purchases and sales right now, and when the great maxim of your ponzi is 'HODL', the fact that there's more Tether in the system than USD or other kinds of fiat isn't so terrible an issue, at least right now.
Since the system itself runs on electricity (miners have to be paid), it can be said to run on fiat. As more and more fiat is taken out of the system to pay to keep the lights on, more and more fiat is required to maintain the price, let alone lift it. The idea is that the $58B Tether out there right now maintains the current price of BTC (nominal market cap of $815B) and ETH ($300B). How, though? Well, in a normal regulated economy in which knowing one's customer in and of itself prevents all kinds of fraud, pumping a commodity, company, or real estate is pretty tough. With crypto and $60B in neopoints that you can print without any cause in the world, it's about as simple as it sounds to pump hashes stored on hard drives.
It sounds like a conspiracy theory, though: an explanation for unwarranted coin prices, as explained by a little-known stablecoin. When I first heard about Tether, I thought it was the convoluted way Butters used to explain why they're not actually poor. This is from coinlib.io. One would think from that image that when the employee at Taco Bell hears his friend talking about BTC's exploding price, he then tells him to be sure to purchase it with Tether. But this is what the whole system depends on: idiot puts in $100, miner takes out $100 in fiat to pay his electricity bill and buy weed, and $150 of Tether is printed from nowhere and backed by nothing to make up for the lost fiat.
I read this like 3 times and kind of understand now. Thanks for the explanation. So to my understanding, Tether is basically like a regular crypto since it is not backed by anything, but is pretending to be a stable coin so it can mislead the crypto market into thinking that there are tens of billions of dollars more in the market than actually existing. This will prop up the market in a massive ponzi scheme which will inevitably collapse once prices fall and people cash out. The only question I have is after the $58B in tether getting wiped out, shouldnât the general crypto market not get too much affected since people can buy and sell crypto directly in fiat while cutting out any stablecoin middleman. The only people who get screwed are the ones who hold tether during the crash.
This is still pretty hard to wrap my head around. I remember first hearing about crypto around 2011 and thought it was a cool internet currency to buy stuff on the deep web. Sold everything in 2014 and 2016 for a couple grand with quite a bit of regret now. Simpler times back then.
To fully understand it, I probably read 20,000 words over two months lol
It's thought that Tether was once backed 1:1, but needed to grow to keep up with its own usecase. Eventually, they themselves said that they were only backed by 75 cents or something per dollar (and that's their own word). Last I heard, they were trying to claim that Tether is backed by assets and purchased debts. For one thing, $1,000,000 in debt isn't worth a million dollars, and they didn't specify if these are student loan debts, or debts to shell companies they themselves created. All that really means is that Tether doesn't need to maintain an aboveboard image in order to function, because why would they ever let that information out lol
Today's crypto is fucking weird, because of the exchanges. Nobody owns the hashes anymore, and the price isn't coming from those websites where they'll sell you 2 BTC at $80,000. The people who invest in crypto are so scared of wallstreet suits and shady governments, and happily throw their money into a big pit overseen by faceless, nameless internet companies with shiny websites and partnerships with banks from El Salvador.
Remember the celebrities who lost money to Madoff? Madoff was playing with a slushfund of $65B to maintain that ponzi, which is a lot of grannies' retirements. We're looking at a ponzi scheme several times that value, though of course not $1.1T. Only the exchanges know how much USD or fiat in general is in the system; and what's guaranteed is that the longer they go unabated, the higher the prices will soar. If Tether continues to print incontinently, BTC will go to $100k. The problem with that is that it's not for the reason the laser-eyed Twitter users think.
25 comments
44 jcvfcvujyhhtif 2021-06-15
As a committed lover of drama, I've been steadfast in getting my updates on Tether now for about a year. If Tether breaks, and BTC and ETH go down to $500 and $5, we're looking at a kind of dramahappening unlike anything we've seen since 2016. The fact that people will lose everything means that this level of fallout could surpass 2016 election night.
22 Dr_Ama_Lama 2021-06-15
Inshallah, please will itđ
15 __TIE_Guy 2021-06-15
Like the market crash of the 90's but for nerds.
10 CopeSeetheDial8 2021-06-15
Get the pink wojacks ready
3 AugustinesBitchBoy 2021-06-15
Can a coin-cel explain why Tether blowing up matters to other coins?
1 jcvfcvujyhhtif 2021-06-15
Say a BTC is worth 40,000 in USD, but all I have is Tether, and I can offer you 40,000 of them. That's the agreement right now; but if it's revealed that a Tether... isn't even worth nearly a cent, then what is that BTC you bought going to be resellable at? Prolly not $40,000
1 I_Shah 2021-06-15
Isnât BTCâs value free floating and tetherâs value âpeggedâ to USD. I still donât understand how tether imploding will effect anything else other than undermining the faith of the crypto market as a whole
4 jcvfcvujyhhtif 2021-06-15
So much of the liquidity involved with BTC, ETH, and DOGE is Tether. Tether's the on-ramp and off-ramp for most purchases and sales right now, and when the great maxim of your ponzi is 'HODL', the fact that there's more Tether in the system than USD or other kinds of fiat isn't so terrible an issue, at least right now.
Since the system itself runs on electricity (miners have to be paid), it can be said to run on fiat. As more and more fiat is taken out of the system to pay to keep the lights on, more and more fiat is required to maintain the price, let alone lift it. The idea is that the $58B Tether out there right now maintains the current price of BTC (nominal market cap of $815B) and ETH ($300B). How, though? Well, in a normal regulated economy in which knowing one's customer in and of itself prevents all kinds of fraud, pumping a commodity, company, or real estate is pretty tough. With crypto and $60B in neopoints that you can print without any cause in the world, it's about as simple as it sounds to pump hashes stored on hard drives.
It sounds like a conspiracy theory, though: an explanation for unwarranted coin prices, as explained by a little-known stablecoin. When I first heard about Tether, I thought it was the convoluted way Butters used to explain why they're not actually poor. This is from coinlib.io. One would think from that image that when the employee at Taco Bell hears his friend talking about BTC's exploding price, he then tells him to be sure to purchase it with Tether. But this is what the whole system depends on: idiot puts in $100, miner takes out $100 in fiat to pay his electricity bill and buy weed, and $150 of Tether is printed from nowhere and backed by nothing to make up for the lost fiat.
2 I_Shah 2021-06-15
I read this like 3 times and kind of understand now. Thanks for the explanation. So to my understanding, Tether is basically like a regular crypto since it is not backed by anything, but is pretending to be a stable coin so it can mislead the crypto market into thinking that there are tens of billions of dollars more in the market than actually existing. This will prop up the market in a massive ponzi scheme which will inevitably collapse once prices fall and people cash out. The only question I have is after the $58B in tether getting wiped out, shouldnât the general crypto market not get too much affected since people can buy and sell crypto directly in fiat while cutting out any stablecoin middleman. The only people who get screwed are the ones who hold tether during the crash.
This is still pretty hard to wrap my head around. I remember first hearing about crypto around 2011 and thought it was a cool internet currency to buy stuff on the deep web. Sold everything in 2014 and 2016 for a couple grand with quite a bit of regret now. Simpler times back then.
3 jcvfcvujyhhtif 2021-06-15
To fully understand it, I probably read 20,000 words over two months lol
It's thought that Tether was once backed 1:1, but needed to grow to keep up with its own usecase. Eventually, they themselves said that they were only backed by 75 cents or something per dollar (and that's their own word). Last I heard, they were trying to claim that Tether is backed by assets and purchased debts. For one thing, $1,000,000 in debt isn't worth a million dollars, and they didn't specify if these are student loan debts, or debts to shell companies they themselves created. All that really means is that Tether doesn't need to maintain an aboveboard image in order to function, because why would they ever let that information out lol
Today's crypto is fucking weird, because of the exchanges. Nobody owns the hashes anymore, and the price isn't coming from those websites where they'll sell you 2 BTC at $80,000. The people who invest in crypto are so scared of wallstreet suits and shady governments, and happily throw their money into a big pit overseen by faceless, nameless internet companies with shiny websites and partnerships with banks from El Salvador.
Remember the celebrities who lost money to Madoff? Madoff was playing with a slushfund of $65B to maintain that ponzi, which is a lot of grannies' retirements. We're looking at a ponzi scheme several times that value, though of course not $1.1T. Only the exchanges know how much USD or fiat in general is in the system; and what's guaranteed is that the longer they go unabated, the higher the prices will soar. If Tether continues to print incontinently, BTC will go to $100k. The problem with that is that it's not for the reason the laser-eyed Twitter users think.
11 AntiP--sOperations 2021-06-15
Brokebucks mt gox.
9 SnapshillBot 2021-06-15
If you find yourself comparing politics to sex you should neck yourself, because you're clearly doing both wrong.
Snapshots:
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8 Desert_Knight 2021-06-15
Based once again, I believe in AI supremacy
7 fujiste 2021-06-15
1 911roofer 2021-06-15
He kinda looks like Doug Walker
1 TheColdTurtle 2021-06-15
I break the buck so you don't have to!