/biz/ - Business & Finance

tldr: TETHER IS NOT BACKED BY DOLLARS, BUT RATHER CRYPTOS. MAJOR NON-SEC SANCTIONED EXCHANGES COLLUDING TO MAINTAIN 1:1 PEG. USER HAS NO 'RIGHT' TO REDEEM USD FOR THEIR TETHERS.
WILL LIKELY BE FORCED TO DO AWAY WITH "1:1 PEG" ILLUSION

This new #Tetherleaks mails are huge... They confirm everything we've warned of since months/years and indicate that it may be even worse. The priority now should be to verify the material and to get as many retailers out as possible (1/7)

They confirm 1) being backed with crypto and 2) they try to fool regulators about that fact (2/7)

They want to stop #tether being a "stablecoin" (giving up the peg). This is intuitive: theie backing is not worth 1 USD for 1 USDT because it's backed with volatile crypto. But then tether is NOT a stablecoin (NOT today and NOT in the future) (3/7)

Remember: if you hold / trade USDT you've no right to redeem in USD! This implies that if people start to cash out and the value of reserve per issued tether exceeds 1 USD they will eventually pay you in USD (if it was not created out of thin air) (4/7)

and therewith do not reward you for the risk you accepted all the time (you've been basically invested in a bunch of volatile crypto's while they told you you're safe; clearly your payoff needs to be higher because you need to be compensated for the risk; finance 1:1) (5/7)

But what if the value of reserves per coin of tether is below 1$ at the time you want to redeem? Then you bear the whole risk and can't redeem the full amount (if at all)

Great: you bear the risk, paolo gets the returns. That's how it is.
(6/7)

So much more to say here... Especially that they manipulate crypto prices with printed tether.
But the point is we should try to verify the info first. Then we need to spread the word while being careful that Paolo & Co don't accelerate their ponzi and disappear with the bn (7/7)

>https://twitter.com/RiskIndemnity/status/1365887612020543491