Tether Discussion featuring Bennett Tomlin and George Noble

Sometimes I wonder if this is how Michael Burry and others felt before the housing crash.<p>Right before the housing crash, most the in-industry folks were fully aware it was unsustainable, but they felt it would continue long term. Same goes for tether, majority of those involved in crypto know what they are doing, and the pump-up effect it&#x27;s had to crypto.

There are a few issues at play here:<p>1. A lot of newly &#x27;minted&#x27; Tether&#x27;s are being used to buy Bitcoin (so prop it up, the Bitcoin price rises).<p>2. <i>Possibly</i> as a next step, these now more valuable bitcoins are than sold for real money, and the owners of bitfinex&#x2F;tether pocket this real earned money as profit.<p>3. It should be noted that although the total amount of tether is still rising, the total amount of all &quot;stable coins&quot; is rising a lot faster, so basically, outpacing the growth of tether: the market seems to be on to them, and puts more trust in other stable coins. Personally, I like Maker&#x27;s DAO decentralised SAI stable coin a lot. But preferences vary.<p>4. Why is there any demand at all for <i>any</i> stable coin? Can&#x27;t a person just send&#x2F;receive real dollars&#x2F;euros? Answer: <i>No</i> .<p>There are a lot of unbanked people in the world, more than we in our western minds would dare to guess, I think.<p>Look at El Salvador: in 6 weeks since officially adopting Bitcoin as a currency (next to the US dollar, not <i>replacing</i> it mind you) the number of people that now have &quot;wallet&quot; software running on their phone is already lager then the number of people who over the past <i>20 years</i> were able to open a bank account.

I know some seriously sophisticated folks who are not only trading USDT at par, but even <i>long</i>, which I have long found puzzling given that anyone who didn’t just fall off the turnip truck knows it’s not even remotely capitalized to par.<p>My personal suspicion is that when a trivially distressed asset is valued at or above par by smart people that those people expect a bailout&#x2F;recapitalization.<p>(Sidebar: USD is special among “fiat” currencies at the moment because its backed by the world’s largest military. Having guys with guns show up if you refuse to treat something as valuable is a pretty compelling argument to treat that thing as valuable.)

For what it’s worth, this is from July. It predates the recent CFTC news.

I downloaded the mp3 to listen to this, but the audio is filled with weird squeaks, squawks, and short skips. I don&#x27;t know if their microphone is broke, if this is some effects they added to be cute, or if their mp3 download is simply corrupted. Either way, it&#x27;s intolerable. I couldn&#x27;t listen to it for more than a minute.

Something I was thinking about is that this year alone Tether received almost 50 billions of new US dollars for printing the same amount of their coin, reaching the staggering Market cap of 68B.<p>Even if they started as a scam and were a few billions out of parity, 2021 gave them a lot of additional runway, allowing them to recompose their reative parity to the USD.<p>For instance, they could be 80% backed at the start of the year, and after 2021 cash inflows so far they could have gone up to 93% backed by simply doing nothing.

Personally, i dont see any difference between any coin and and &quot;real world&quot; currency.<p>I dont mean the power behind it and stuff.<p>But crypto basically left the gold standard itself a long time ago!

Everyone shall start with FED investigation and it&#x27;s whole ecosystem behind it, it&#x27;s much bigger fraud. They shall start with Paret rule here :D

You could just remove the T. In all seriousness the way the US gov has been playing with the debt ceiling and the enormous amount of money being printed the USD also has some serious issues.