Consolidated Crypto Traders/Chat Thread

Discussion in 'Blockchain & Cryptocurrency Mining' started by Optimus., Dec 15, 2017.

  1. gmturner

    gmturner Member

    Joined:
    Jun 11, 2006
    Messages:
    1,384
    Location:
    Launceston
    i actually really need to look into how it works, how it maintains its pegged price etc and get my head around how it helps/hurts the markets. But if the main company that issues it is forced to take it down i imagine it will cause a really ugly cascade as people try to get out of it on all exchanges.
     
  2. koss

    koss Member

    Joined:
    Mar 6, 2009
    Messages:
    8,014
    Location:
    Vic
    How it works is simple, Tether Inc. will give you $1 US for each Tether coin you cash in and they will sell you one for $1 there is a small fee which is their profit. That's all there is to it. However, if they don't have enough $ to honor a big cash in of Tether coins, then the whole thing explodes like a bank run.
     
  3. dirkmirk

    dirkmirk Member

    Joined:
    Apr 3, 2002
    Messages:
    5,486
    Location:
    Shoalhaven - Gods Country
    I still don't understand how the price can remain so stable when priced in btc and thus in usd, it's like supply and demand is in perfect sync all the time, you would think some exchanges would have liquidity problems and the price of tether would soar but it doesn't.

    Don't know just found it strange.
     
  4. koss

    koss Member

    Joined:
    Mar 6, 2009
    Messages:
    8,014
    Location:
    Vic
    Tether is not priced against BTC, it's priced against USD. That's why you are having trouble understanding. One Tether = $1USD +/- fees, nothing to do with BTC whatsoever.
     
  5. dirkmirk

    dirkmirk Member

    Joined:
    Apr 3, 2002
    Messages:
    5,486
    Location:
    Shoalhaven - Gods Country
    Well put it another way, I start up a 2 bit exchange with 100,000 tethers and the market starts crashing big time and you have panicked sellers wanting tether, if the supply dries up you could charge a premium.

    For the price to remain rational as it has been, their must be an assumption an exchange could sell the tethers as a premium and immediately redeem them at Tether incorporated for USD making an instant risk free profit, is their any proof that this happens?

    I guess im wondering if the exchanges are engaging in fractional trading, a large exchange could have 10s of millions or hundreds of millions of tethers suppossedely held in customer accounts.

    Who's redeeming the tethers for USD?
     
    Last edited: Apr 1, 2018
  6. koss

    koss Member

    Joined:
    Mar 6, 2009
    Messages:
    8,014
    Location:
    Vic
    It happens every minute with every coin pair, there are always a range of ask and bid prices not just the one.
    That's why prices move up and down, because you run out of coin for sale at the price you want, and have to settle for another price or go without. There is always the 100,000 Tethers on the exchange until someone decides to withdraw.

    As I mentioned in post #564, Tether Inc. will redeem your Tether for $USD.
     
  7. douver

    douver Member

    Joined:
    Mar 8, 2002
    Messages:
    1,254
    Location:
    Brisbane
    Tether actually has a legitimate business case to support its valuation (much unlike almost all altcoins), would you be happy managing 2 billion with a payoff of bank interest? If 3% interest thats like 60 million a year, so it is actually reasonable that a company would want to run this properly (no guarantee it is though).

    Easiest ways to redeem tether currently: If you deposit tether at Bitfinex it just becomes USD (and vice versa). You can also trade it for USD on Kraken as they have a USDT/USD market (usually trades at the BTC premium ratio of Bitfinex/Kraken).

    Tether can go out of whack for short periods but above arbitrages bring it back into line after required confirmations, during big BTC dumps after the big Poloniex altcoin pumps last year you could buy BTC like 10-20% below market price with it as people panic sold. Similar situations occurred later during dumps on bittrex/binance after everyone moved there. After this happens a few times the exchange seems to get enough liquidity though.
     
  8. koss

    koss Member

    Joined:
    Mar 6, 2009
    Messages:
    8,014
    Location:
    Vic
    Or perhaps don't actually receive any USD, just put a billion Tether into circulation via Bitfinex or some other partner in crime, and trade it for real coins like BTC with none the wiser.
     
  9. shredder

    shredder Member

    Joined:
    Dec 26, 2001
    Messages:
    13,969
    Location:
    New Zealand
    Let us never forget that Bitfinex and Tether are run by the same people, to a degree that one could simply consider them two arms of the same business.

    --

    "Tether tokens are issued by Tether Limited, a company based in the British Virgin Islands according to the New York Times. Tether’s website says it is incorporated in Hong Kong, with offices in the US.

    The company has many of the same management team as Bitfinex, the Hong Kong-based cryptocurrency exchange that is one of the biggest in the world. Jan Ludovicus van der Velde is CEO of both Bitfinex and Tether, and Philip Potter is chief strategy officer for both businesses, for example."

    --

    "For starters, Tether and Bitfinex share two of the same operators, Phil Potter and Giancarlo Devasini. Potter is both a director of Tether and chief strategy officer at Bitfinex; Devasini is a director of both Tether and Bitfinex. In December, Quartz reported that the relationship between the two firms “provides a key channel for tethers to entercryptocurrency markets.”"

     
  10. douver

    douver Member

    Joined:
    Mar 8, 2002
    Messages:
    1,254
    Location:
    Brisbane
    Could say the same for any unregulated exchange. What if altcoins on binance just pumped because they gave themselves fake btc balances to pump with?

    There are definitely a lot of scam coins and exchanges out there, sure tether could be one but it cops more than its fair share of criticism.
     
    Jihosi likes this.
  11. shredder

    shredder Member

    Joined:
    Dec 26, 2001
    Messages:
    13,969
    Location:
    New Zealand
    Anecdotal evidence indeed suggests that the main everyday manipulator of the crypto charts is spoofed (aka fake) orders, combined with "pushing", which is when a manipulator uses these spoof walls in combination with a rush of staged trades to initiate a snowball effect in the market (which they then rake the cream off of, before simply removing their spoof orders, and reversing the direction for the next round).

    I've watched these markets for years and that dynamic has been constant. The only variable is whether or not there are fundamentals backing the manipulation - which only amplifies the manipulation's success, resulting in what we have come to know as a "pump".

    There are so many ways for the rich to manipulate these markets. There would be zero need to expose themselves to corporate crime at all, logically speaking.
     
    Last edited: Apr 1, 2018
  12. koss

    koss Member

    Joined:
    Mar 6, 2009
    Messages:
    8,014
    Location:
    Vic
  13. douver

    douver Member

    Joined:
    Mar 8, 2002
    Messages:
    1,254
    Location:
    Brisbane
    I said tether might be a scam, there's no proof either way. Same as Binance, where's their audit or proof of balances? Both are also doing somewhat underhanded moving office's etc to hide from authorities too.

    If you believe tether is such a "obvious" scam surely you also put into question every altcoin listing from any exchange that trades it, as they list "obvious" scams.
     
  14. shredder

    shredder Member

    Joined:
    Dec 26, 2001
    Messages:
    13,969
    Location:
    New Zealand
    Yes the sentiment around Tether, while possibly true (or possibly not), is inflated by media-fuelled hype. Has been for a long time, and still without any real proof either way.

    As we know, the public will put their attention where the media tells them to put it.

    This does not equate to merit or balance or truth or proportionality.

    Experienced players need to look at the whole picture, beyond just the media-fed stuff.

    Save your paranoia for the scandal that nobody knows about.
     
    Last edited: Apr 2, 2018
  15. douver

    douver Member

    Joined:
    Mar 8, 2002
    Messages:
    1,254
    Location:
    Brisbane
    Anyway starting to have faith BTC can make it back to 12k again. Rather than fakeout high over the weekend as I expected after okex futures positions were closed, looks like we faked out low.

    Also been filling a few bags of altcoins too as they are starting to look bottomed out and will likely bounce if BTC does, mostly hoping for some 'oldschool' (oldschool in crypto is anything over like 3 months ago :tongue:) resurgence, ZEC/XMR/OMG/GNT.
     
  16. OP
    OP
    Optimus.

    Optimus. Member

    Joined:
    Jun 27, 2002
    Messages:
    6,443
    Think longer term. :)
     
  17. koss

    koss Member

    Joined:
    Mar 6, 2009
    Messages:
    8,014
    Location:
    Vic
    The obviously coordinated 7pm dumping seems to have started.
     
    Smoothie likes this.
  18. Smoothie

    Smoothie Member

    Joined:
    Oct 12, 2003
    Messages:
    568
    Location:
    Bendigo, Vic
    Yep, we came so far all day - now a sea of red.
     
  19. OP
    OP
    Optimus.

    Optimus. Member

    Joined:
    Jun 27, 2002
    Messages:
    6,443
    The trick is to dump at 6:30!
     
  20. koss

    koss Member

    Joined:
    Mar 6, 2009
    Messages:
    8,014
    Location:
    Vic
    Lol, tonight for sure. Often there has been action at 7pm. not sure why. The US is still asleep.
     

Share This Page

Advertisement: