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0 pointsLionga3y ago0 comments

If just 10% of the "1:1 USD stablecoins" where cashed out today their price would fall 99%. And bitcoin and ethereum are also just at a "value" that's inflated 10 to 100 times due to crypto internal leverage.

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danielvf3y ago

We've already seen more than 10% of USDT cashed out in a previous exciting time a few months ago and the traded price value went down a few cents for a few hours. Nothing remotely like 99%.

LiongaOP3y ago

It was a maximum of around 1% in a single day and this made Tether fall 2 or 3 percent during LUNA crash. The problem is the selling pressure does not interact linear with price but exponential

mumbisChungo3y ago

No, USDT and USDC are both backed on a 1:1 basis by banking custodians which are regularly audited.

alasdair_3y ago

USDT is backed by over $8billion in commercial paper, a lot of which seems to be in Chinese real estate companies that are very unlikely to be worth their claimed value.

And note that this was true in May - global markets are WAY down since then.

Moreover, it was only a spot verification - they could have moved money into treasuries for a day and then moved it back again. The auditors explicitly avoided commenting on this.

mumbisChungo3y ago

Yes, it looks like 12% of their assets are in commercial paper.

I'm not claiming to be an omniscient source of truth, but USDT is supposed to be backed 1:1, is audited regularly, and has survived extreme volatility events and bank runs for the better part of a decade.

Maybe it will collapse some day. I personally have more trust in USDC and Circle, so I use that if I need a stablecoin.

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Elinvynia3y ago

Could you point me to an USDT audit? Thanks!

ulrashida3y ago

Roughly 20% of Tether's "cash equivalent" investments are with grade A-1 and A-2 parties. It's effectively stable, until it's not. We'll see it in our lifetimes.

mumbisChungo3y ago

https://tether.to/en/transparency/#reports

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LiongaOP3y ago

The whole audit is nicely cover in a single "Trust me bro"

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j / k navigate · click thread line to collapse

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danielvf3y ago

We've already seen more than 10% of USDT cashed out in a previous exciting time a few months ago and the traded price value went down a few cents for a few hours. Nothing remotely like 99%.

LiongaOP3y ago

It was a maximum of around 1% in a single day and this made Tether fall 2 or 3 percent during LUNA crash. The problem is the selling pressure does not interact linear with price but exponential

mumbisChungo3y ago

No, USDT and USDC are both backed on a 1:1 basis by banking custodians which are regularly audited.

alasdair_3y ago

USDT is backed by over $8billion in commercial paper, a lot of which seems to be in Chinese real estate companies that are very unlikely to be worth their claimed value.

And note that this was true in May - global markets are WAY down since then.

Moreover, it was only a spot verification - they could have moved money into treasuries for a day and then moved it back again. The auditors explicitly avoided commenting on this.

mumbisChungo3y ago

Yes, it looks like 12% of their assets are in commercial paper.

Maybe it will collapse some day. I personally have more trust in USDC and Circle, so I use that if I need a stablecoin.

1 more reply

Elinvynia3y ago

Could you point me to an USDT audit? Thanks!

ulrashida3y ago

Roughly 20% of Tether's "cash equivalent" investments are with grade A-1 and A-2 parties. It's effectively stable, until it's not. We'll see it in our lifetimes.

mumbisChungo3y ago

https://tether.to/en/transparency/#reports

1 more reply

LiongaOP3y ago

The whole audit is nicely cover in a single "Trust me bro"

1 more reply

j / k navigate · click thread line to collapse