So say while bitcoin is dropping tether mints 100 million new coins. These new coins get moved to binance and finex and all the exchanges that use tether, correct? The exchange pays tether for the tether they receive. Ok.

Now with these new tethers, binance can offer to take your falling btc and give you tether in exchange. So how does this make the price of btc stabilize or even start going up? If people are dumping their btc, wouldn't this create even more downward movement? I would think giving people an easy option to get out of btc would make btc more likely to accelerate dips, since people aren't forced to hold or go through an hour long withdraw through coinbase.

Again, I'm probably confused here, someone help.

The assumption based on the butthurt ramblings of a delirious twitter troll who sold all his Bitcoin at $1k. Somehow he managed to gain a mass following -- likely of top buyers and bottom sellers -- who en masse parrot his conspiracy theories based on thin evidence.

Obviously the lack of transparency and oversight of the mass issuance Tether is a concern, and I advocate holding as much as the risk/reward warrants, but it would be nice if people performed independent research or brought something new to the discussion instead of taking his idiotic conclusions at face value.

Imo government should slam exchanges and ask them to change USDT to something that is not giving a false sense of security to people.

Its baffling that people dont want more clarity on that issue.

The hype around bitcoin has waned quite a bit in the past month or so, more tethers were printed in the past month than ever before (money coming into the system, supposedly) yet the price has dropped almost 50%. Doesn't add up.

And how, pray tell, will the "government" "slam exchanges" that exist in virtual offices around the world and do not have legacy banking relationships? The US could potentially shut down Bittrex and Polo (and in the process seize ~80% of circulating USDT), but either new exchanges outside of US jurisdiction would arise to take their place, or existing USDT exchanges will emerge as the new market leaders to service demand.

Why would placing bids above the current price in tethers which a lot of people see like bids in dollars push the price down. In the end the people having balances in tether will hold the bag. It is like mtgox only in stead of trades with not existing bitcoin they now added a layer of possibly worthless tether. I am also not sold on the whole story but something fishy is definitely going on. It would make a lot more sense if the same people also control a large percentage of mining but I don't know if that is the case.

How big of a deal it is depends on how much money is involved when it blows up. MtGox did no permanent damage and tether won't either except when the amounts are so big that governments feel forced to step in to prevent it from happening again.

The financial world is pretty small when it comes to regulations. Most banks want to do business in the US and EU and they almost always act together on fraud and aml laws. And bitcoin is not big enough yet to be meaningful without easy exchange between fiat and btc.

Maybe I'm lucky but I've managed to deposit/cash out multiple times using coinbase and seals with clubs, no trouble.

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All financial services on USDT exchanges are completely disconnected from the global banking network, funding is restricted exclusively to cryptocurrencies. None of the big regulated fiat exchanges service BTC/USDT trading pairs.

If this blows up with massive losses then regulation will not make that distinction. They will go after every exchange.There are zero regulated exchanges by the way. Some claim they are but all they do is voluntarily follow certain regulations. There are no legal consequences if they break them.

I don't disagree, but you are changing the discussion. Eddie was saying the ominous global government should "slam" the dozens of USDT exchanges... somehow.

Sorry, missed that bit. I agree they can't do that. They would slam everything.

Are you skipping a step here? To get tether in the first place, after a new 100 million has been printed, people have to buy them, mainly with btc. I'm talking about new tethers that are printed, not ones already in circulation. The ones in circulation are already held by investors, and to get rid of them a person uses them to buy btc. In my mind if people start doing that it drives btc price up, no?

For the new tethers that just got printed, they are held by the exchange, meaning you have to sell your btc to acquire them. So selling btc, drives the price down, as usually occurs when btc starts sliding. So btc drops, people sell their falling btc for new tether that just got printed, and this makes the btc price stabilize how? I'm still not seeing it.

Seems weird that, on a poker site, Full Tilt hasn't been mentioned yet. Somehow the feds figured out that FTP didn't have the reserves they claimed to have and seized their domains. I'm sure there are nuances and differences that I'm glossing over, but why couldn't something similar happen with Tether?

Technically you don't need a domain to run an exchange or a pokersite for that matter.

I've been reading about Tether, trying to wrap my head around it's impact as well. Someone can chime in if this is totally off base but, surely people don't only sell when the price of btc is falling. So, worst case scenario, Tether is printed out of thin air and they are used to buy bitcoin at whatever price, because the tether cost nothing to make. If there is a 100 million of USDT trying to buy bitcoin the price is going to go up or be stabilized while falling because of the immense buying pressure of what people believe to be legit currency.

http://www.tetherreport.com

All exchanges that accept $ deposit shouldn't be allowed to use USDT as a name for tether. Very easy to enforce
Most people think they are trading some $ when they have some tether.

It's obviously a bit shady but seems like a brilliant and much needed service for the crypto exchanges. I think the best point that someone brought up earlier is to think about the situation on the exchanges that have no Fiat currency options and how USDT is a very important service for them.

Think of the type of investors these alt exchanges are dealing with. Young, FOMO, panicky, enter/exit whole positions with no regard to the tax situation generally and greedy. During any bad news or -10% move, people typically want to exit the junky coins in their portfolio first. Which pretty much is the reason people use these alt-exchanges with lots of coins and no fiat currency options. You don't really go there to buy btc/eth unless you are arb'ing. So it all sells off hard on these exchanges as everyone is trying to hit the exit at the same time. But some want to exit everything and if they only had BTC/ETH pairs, they would then transfer it over to their main exchange and cash it out to fiat perhaps to feel safe during the bad news/panic move. Which would kill these exchanges with losing lots of customers. So at least now they have a safe pair on their exchange and people could cash out to USDT and not completely exit the exchange. Some try to time it, to buy back in cheaper as it goes down or when it starts to rebound, FOMO kicks in and they buy back in not wanting to miss out on the rebound.

So you arrive in the crypto threads 20 days ago at peak bubble, and instead of asking questions to learn a thing or two, you talk as if you are an expert on every crypto-related subject despite lacking a ****ing clue about how any of this works.

Two days ago he partook in a spirited debate about the viability of enforcing taxes across sovereign borders. lol.

Between this thread, oblivious Youtubers like Polk somehow having a huge platform, people posting stupid comedy videos, the incessant shilling of referral links... The similarities between now and Party Poker circa 2005 are crazy.

FTP was prosecuted for money laundering after the DOJ seized a substantial amount of money from their sole remaining payment processor. Afterwards, the DOJ permitted Stars and FTP to issue one-time withdrawals to US customers, which is when we found out that FTP was insolvent.

Interestingly, a trading market was born for FTP funds, and I recall most FTP funds being sold for 10-15c/$.

Anyway, the main difference is that Tether (and Bitfinex) is not obligated to redeem tokens for fiat except for a select few corporate customers. Most conversations from USDT -> fiat happens by buying cryptos to sell on exchanges with fiat withdrawals.

Thinking exchanges are missleading random people with a token named after USD is totally outrageous, i ve no more clue than anyone in this thread if tether is legit because nobody really knows but i am the one bad posting.

We'll know in 6-9 months if this is true or if it was just a slight correction that has been happening all the while BTC moves higher.

by whom? I keep coming back to this. After the 100 million are printed, they are then sold to exchanges? Once the exchange (say binance) has them, they then sell them. Correct so far? So they first are in binances wallet. So next step, you have to sell your btc or eth to get the new tethers. If thats the order, how is that making the btc price stabilize or go up? I know I'm missing something because lots of smart people see problems, so please somebody tell me WHAT I AM MISSING??

Are you saying that once binance has the newly minted tether THEY are then buying btc with their newly printed tether?