Some people must be feeling a little bit silly right about now. Bitfinex 'opened' back up their banking yet, the premium remains. Weird.pic.twitter.com/1trL67YHPW
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I'm more than convinced that BFX are shithead conartists in a lot of ways, but on this one you're just throwing words around. Of course they're going to buy back their own liabilities @ discount on Kraken, and sell additional liabilities @ premium. None of that is inherent fraud.
It's a nice theory but it's a huge damage to their reputation to allow Tether to be trading 5% discount.
Assuming they're market making on Kraken, they have no choice if they can't wire USD to Kraken.
If they can't wire money to Kraken, then they can't wire money to anybody.
Which makes me wonder how the scheme is supposed to work: after they’ve pumped btc with worthless scam tether, how are they converting the hundreds of millions in BTC to fiat?
Print Tethers -> Buy Bitcoin, inflating prices -> people see prices rising and then FOMO in with real money -> Sell Bitcoins bought with $10m of fake money for $15 million of real money. It breaks down when retail stops fomo'ing in.
Right, I get that. My question is more specifically where the transaction from BTC to $$ is occurring. The pumped btc would then need to go to another exchange or some otc process, right?
Yes it could go OTC. And remember, they could do this very quickly, by placing sell orders on real USD exchanges as traders FOMO, plus they can profit from high leverage longs on Bitmex. If you know you're going to push the prices up $500 in 15 minutes, go long on Bitmex.
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