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Well, that potentially explains why Tether hasn't been shorted out of existence. I was thinking it was going to be "shorting costs - uncertainty < other crypto yields for crypto speculators". This claims the real explanation is a lot grimmer. (Though, also roll to disbelieve.)

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PSA: Do not attempt to short Tether. If you obtain a large enough position in Tether, the exchange will leak your position to Bitfinex shareholders who will coordinate to liquidate your short position. This happened on Kraken. Tether went over $400 per tether, twice.

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Tether is the thing that those outside the industry are the most worried about, which folks inside the industry are generally the least worried about. Some pretty reasonable discussion about it on Odd Lots podcast with

recently.

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What was said therein, if there's any short summary?

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I may not be doing this justice, but: - FTX has redeemed billions - Yes, tether is messy, but no real worry that it's worth grossly less than peg. - Likely case Tether fair val between $0.99 and $1.01. Worst "reasonable" (but still unlikely) catastrophe scenario maybe ~$0.88.

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FWIW, having been in the industry for many years, I'll add that I've never seen anyone who interacts with tether directly - ie redeems in size (8+ figs) - have a problem with it. The people who are most skeptical are folks outside the industry who have the least direct experience

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That said, I wish they were more transparent. Their setup is probably messy...there may be regulatory issues, idk - I have no direct knowledge here. Govs may attack them, etc. But all the nasty conspiracy theories about the money flat out not being there seem not credible to me.

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Just my opinion..gut feel FWIW, longtime crypto folks are generally a skeptical bunch. We've seen things go down in flames a lot over the yrs. We're not ignorant to risks of this kind. But tether doesn't sit nearly as high on risk scale as plenty of other things in crypto to me

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yup, original tweet is total bullshit, kraken usdt markets tend to be illiquid and no one would hold a large short there anyway

3:16 AM · Aug 11, 2021Twitter Web App

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