Peg
Posted Apr 18, 2021, 4:18 AM UTC
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Tether briefly hit $1.50 on Binance US.
I feel a disturbance in the force, Paolo.
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Use the Printer, Paolo
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I think Paolo can't sleep thinking about the right time to print. Think about it. He has the power of a Greek god, simply playing tricks with mortals. A strong headache? Print more USDT. Being investigated for fraud? Print billions in one batch, of course. Did he have nightmares of being in prison after Ernie had just died? Print even more! Sad about Duke's funeral? guess what....
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Probably margin traders being taken to the cleaners. Binance allows leveraged positions, when they liquidate traders positions I suppose they trade their cryptos into stable coins.
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yessir
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Remember kids, is this cult there is only one pray (print more Paolo!) and only one mantra (YOU HOLD!).
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When this happened to money markets in 2008, the entire global financial system nearly collapsed
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Yes, but back then, most of the investments were in real money. BTC is being inflated by USDT. It is a casino chip inflated with IOU notes. The only real money that can be lost is that used to buy casino chips, not IOU notes. So since most "earnings" remain within the cryptosphere, they do not represent real money and are harmless to the real cash system. They are as harmful as that night you lost playing monopoly with your family.
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Then the "damage" will be isolated to anyone who put real money into the crypto video game. I'm fine with that.
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Exactly. Like most Ponzi schemes, it will be hell on Earth for the outright burned, but almost comical for the rest of us.
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They already don't have the money. They gave it to someone else when they got their crypto. If crypto goes to zero that's the end of the musical chairs but no money is lost. The people who currently have it, have it.
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Touche. It's a transfer of wealth scheme, like pretty much every scam or Ponzi.
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The GFC of 2008 was a chain reaction liquidity and solvency crisis. When it became clear that it was impossible to evaluate the correct price for MBS instruments and also lenders couldn’t tell how many of what type of these bonds there counter-parties held they stopped accepting them as collateral for loans. Many such companies needed short term loans to meet ongoing debt payments and when they couldn’t get them they defaulted on those loans.
This caused a chain reaction as the companies they defaulted on couldn’t pay their debts.
This caused the CDS ‘credit default swaps’ that some companies like AIG that had written a lot of these insurance policies to actually become insolvent as they couldn’t deliver on the coverage they sold.
So it was the linked, leveraged nature of how these banks and shadow banks operated that caused the collapse.
As long as real financial companies haven’t been using crypto as collateral for loans or something like that a collapse in crypto prices shouldn’t have a systemic effect.
I know Michael Saylor did issue bonds to buy bitcoin, which is insane, but as long as it’s not too many entities being affected at the same time by a price crash it seems the pain would just be absorbed by the hodlers.
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Good points. My thoughts were that a similar 2008-style crisis will happen once Tether breaks, as the the crypto system will lose liquidity causing panic selling, and then all the leverage in the system (options and crypto interest schemes dependent on USDT solvency) will go tits up and default. Ideally will take place entirely within the crypto sandbox, a nuclear bomb inside a snowglobe, and won't affect people's lives IRL.
Unless, of course, you were stupid enough to YOLO your life savings into crypto, and if that's the case, you deserve what's coming to you.
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Good thing crypto is highly contained
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I’ve suggested to advocates that the interest rates payed by various lenders suck as Celsius and BlockFi were highly risky exactly because of stuff like this:
- flash crashes that liquidate leveraged longs leading to more liquidations - and lenders being left holding the bag
- a rush to the exit on any ‘stable coin’ could devalue it.
So you think you’re earning 10% annually on your stable coin interest, but you’re actually risking loss of principal because your money is being loaned out for risky activities, and there’s a chance of degradation of the stable coin itself - I really think some people believe holding a stable coin is roughly equivalent to holding a US dollar.
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It's almost as if creating a US dollar derivative backed by subprime and toxic assets could be a bit unstable. Where have we seen this before I wonder?
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90cent on the Dollar is money laundering numbers...
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Teflon tether
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Not true tho. On kraken its still 1:1
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Peg broke for a bit during the flash crash, but yeah, it's back to normal now.
This does imply that at some point during the crash, BTC/USDT was about 10% higher than BTC/USD
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What is going on with Tether tonight? As of now (11 PM PT) it's showing at $1.02 in the averages, though the USD peg is still 1:1.
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Leveraged traders being liquidated. Exchanges sell their colateral into stable coins.
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If I remember rightly, we saw the same during the last flash crash. When people are trying to take their money and run, they prefer to use an exchange with an actual bank account that can give them actual money, so banked exchanges end up being pricier than unbanked ones.
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I warned this would happen when people pushed for the door. Now we get to see if the bubble really did go bang
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P E G
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[deleted]
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[deleted]
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Too many 0's in the print. Takes the perpetual bird too long to type out unfortunately
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PAULO TURN ON THE PRINTER ASAP!!!!
Heard he is typing the zeros as we speak
He needs to borrow real USD using the BTC as collateral and use that to buy TETHER and create demand.
I heard it will take quite long to type all the zeros this time, might as well need a new keyboard.
r/fuckTether