Yesterday was the day when "100% cash-backed" was revealed to in fact be... 2.9% cash-backed. And yet Tether has still kept onto its $1 peg. Je vois la vie en kayfabe. https://www.ft.com/content/529eb4e6-796a-4e81-8064-5967bbe3b4d9 … via @financialtimes
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Right, but a totally unregulated one. And indeed, that is quite the assumption I think anyway... why not get a proper auditor in?
Sure, I agree you want more disclosure! And I expect that some of the companies backing the commercial paper are not exactly what you would call blue chip. But it seems plausible to me that they are fully backed (for now) and the mix of assets is not *that* surprising.
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I'm not in any doubt that USDT is fully "backed" by some mix of assets, but are the coins issued unbacked then used to purchase something else to create the backing? My strong suspicion is that these debt instruments are simply hiding the fact that crypto is the real backing
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....which, if true, it goes without saying that this means there is considerable systemic risk in the entire crypto market if there is a run on Tether or a reduction in prices of this collateral
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i find it amazing how folks that embrace crypto, i assume out of some lack of faith in the existing banking system (which is at least regulated), seem perfectly fine trusting random shady strangers on the internet who are completely unregulated.
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people embrace crypto because they don't trust the regulators "regulated" is not a positive
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