What Is Tether "USDT"? Is That Just A Scam To Enrich Bitcoin Investors?
 |
| What Is Tether "USDT"? |
If the recipient wishes to use what he has sent, he can go to one of the two Bitcoin ATMs in El Salvador, scan the QR code of the ATMs, and is hit by an app that converts Tether into BTC and sends it to the ATM.
There have been some rumors about USDT, a stable coin that is supposed to be equivalent to US dollars. The total amount in circulation corresponds to the actual US dollar in your bank. You can treat the coin as a US dollar at any time and ask the company to exchange your tether for a dollar bill.
Tether (USDT) is a stable coin that claims to have a value of 1 USDT, which is equivalent to 1 USD. Tether has limited centralized powers, but it has the ability to print USDT and claims to print the equivalent of a US dollar. However, it has not been audited and has been fined by financial regulators for financial misconduct, which shows that stable coins are not backed by US dollars.
In the long term, we expect stable coins to be backed by a currency that can be used for such transfers despite the regulatory risks of the tether. Despite its claims to be a stable coin supplier, Tether Limited is unlikely to be able to support its circulation in USD. Account-holders are likely to exchange and use this to minimize their dealings with the regulated banks that are necessary to deal with the US.
If the USDT claims that it mints new coins in response to a need (for example, giving $100,000 in return for handing over to Tether and calling it Tether), its harshest critics will argue otherwise. Our perspective is to stay away and avoid an exchange with great commitment.
The problem is that this is not just a single company with opaque financial transactions. Bitfinex runs a Panamanian shadow bank called Crypto Capital, which manages money for large cryptocurrency exchanges and earns $850 million of its money from two companies that have never signed a contract. Tether claims to know that dozens of people benefit from pumping worthless USDT into exchanges, driving up the prices of digital assets across the board, and is willing to use social media to defend himself when NYAG announces, for example, that USDT will not shy away from a ban on operations in New York.
John M. Griffin and Amin Shams are two scholars studying cryptos. Sham's analysis suggests that Tether did not shy away from printing coins and moving assets to plug holes in its balance sheet. As we have seen, Tether is a public company whose coin manipulation of the same name was responsible for 10% to 70% of the rise in the price of Bitcoin.
As you know, I am very concerned about retail investors entering the virtual currency market via initial coin offerings (ICO), which allows companies to raise money by creating and selling new virtual currencies. Coins produced by Fiat can be used to manipulate prices upwards. The top crop of exchanges that have consistently served as donors of new issues (USDT, Bitfinex, Huobi, FTX, Binance, let's say Blockstream) has set out into the world to spread tethers and invent new ways to exploit false beliefs and support to enrich the few precious people on the top of the pyramid.
When the Bitcoin price fell below $4,000 last year, the Tethers price held up remarkably well. Given that governments are adopting digital central-bank currencies and regulating tether, it is unlikely to maintain its market impact in the long run. You can sit back and dismiss the sign that pops up on the back of questionable IOUs of unknown companies, printed by one single private company as a fad or something, but at some point, the cable machine will collapse and no one else will be to blame but yourself, and that will sweep the BTC market with it.
The class-action disclosure process could force Tether to reveal more about its internal workings and decisions, as well as its opaque banking relationships.
As a unifying tool for the larger crypto-economy, the potential is clear.
Stock exchanges in the United States are regulated for anti-money laundering purposes by the government and Tether was one of the first to come out of the gate. The Comptroller of the Otting (The Office of the Comptrollers of Currency) has revived the process of providing fintech charters to new companies that offer new services that do not look like traditional banks.
We appreciate that Tether is cooperating with the US Department of Justice (DOJ) and Tether's attorneys have acknowledged that the stable cryptocurrency Tether (USDT), which is pegged to the US dollar, is unsecured. We stand by the USDC because it is issued by a trusted and regulated entity, and unlike algorithmic companies like DAI, it has not been exposed to hackers or bugs. Your average investor's profile is more sophisticated when dealing with things like private and public keys, or at least understanding how the company you work with secures them and how their coin is based on other exchanges.
All rights reserved to the owner: SCOOP HYPE