- USDT is a fictional currency invented by Bitfinex to make up for the fact they don't actually have access to banking because they're unbelivably shady.
- They got many other exchanges onboard since it effectively allows you to skirt AML and KYC regulations.
- Bitfinex is a shadowy cabal of truly dreadful market participants who mess around under the covers with Tether and use it to effectively control pricing. They print Tether and use it to buy BTC to drive the price up. They then sell BTC for Tether if they want to drive the price down.
- They promised for 5+ years that they'd get Tether's bank account audited but instead auditors up and quit.
- They had 30% of their assets seized in a money laundering sting but of course, the exchange rate remained 1:1 instead of 1:0.7
- The NYAG is suing them.
The price you see of BTC doesn't really reflect anything other than Bitfinex' manipulation. The rate of BTC inflation falling from 12.5BTC/block to 6.25/block affects miners and their ability to be solvent. Not much else.
Traders value Bitcoin the same in USDT or USDC, and USDT / USDC trades at parity. That implies the market trusts USDT. It doesn't matter what people on HN say, as long as the market agrees.
1. ...that "the feds are debasing our currency through their relentless printing"
It is producing a measured, consistent, relatively small 2% rate of inflation over decades and decades. They are of course acting on behalf of an elected body, and ultimately accountable to that body. They're also audited.
2. ...that Tether's relentless, un-audited, 70%-at-most backed printing is fine because the "market trusts it" and "nobody's forcing you to use it."
The market trusts it because number go up, and it's in the interest of exactly zero market participants to show the world the emperor has no clothes.
It's also not fair to say that "nobody's forced to use it" when everyone is forced to use it. In 2018, 80% of all crypto exchange transactions were conducted in Tether. That makes USD transactions by far the minority. Since arbitrage bots keep the prices in sync, and the majority is USDT, even the USD exchanges follow the USDT prices so long as there exists sufficient liquidity to balance the books. [1]
[1] https://www.wsj.com/articles/the-mystery-behind-tether-the-c...
"It doesn't matter what those crazy geologists say, as long volcano hasn't exploded yet."
The market can never overvalue or undervalue? Hmm...
It is a fact that at present, you can't replace your entire life with cryptocurrency transactions, but the actions of the Federal Reserve over the last few months demonstrate how useful it is to have a parallel construct that actually represents an asset that isn't immediately able to be transmogrified by actions of a shadowy cabal (JPow in particular, who with his 50mm nest egg stuck in a hole at BlackRock, has a direct incentive to keep markets afloat)
Just my $0.02
