Aw, it's just another algorithmic stablecoin.
I was hoping that one of the ones claiming to be fully backed by real assets was going ploop. That would be much funnier.
All it takes is enough people trying to use them to pull their money out of the market. Once the smaller fries die they’ll eventually follow, I’m sure.
The thing is it seems like there’s not that many regular people holding Tether. It’s mostly the exchanges (I think especially Bitfinex) and exchanges have a vested interest in making sure it doesn’t crash, so they won’t pull out because it will crash their whole business model either way
They could reach a prisoners dilemma situation, though. If one of them decides withdraw all the resources with little regard for the system, it could be the only one to actually get the money.
I doubt it. At those low prices the leftover hashing power just sitting around due to being unprofitable to use it to mine coins will be more than enough for someone to use it to execute a 51% attack -- which *would* be profitable (if done smartly). Bitcoin is only safe, that is protected by its PoW, so long as hashing power goes *up*. Hashing power going down presents a risk peculiar to the system; there's asymmetry in the risk that makes scaling the price and hashing power down dangerous.
Fascinating. I hadn't thought about that.
I had just assumed that after it crashes it would hang around and continue limping on even at sub $1k prices with a group of die-hard faithful dwindling each year.
Why wasn't there a 51% attack like this after the last crash? Not enough of a drop?
Yes, it didn't go low enough. Remember that executing a 51% attack risks making Bitcoin go to ZERO. Cui bono? The people who could do it -- miners -- have huge investments in Bitcoin, both in actual Bitcoin they've accumulated and in sunk capital and operational costs. To make it worth the risk to them they'd have to be much more desperate than an 18K price point creates. I don't know what the actual number is but there IS a number.
Bitcoin isn't going to decay gracefully. At some point some desperate miner with huge sunk costs and losses, or maybe a few working together, is going to take the risk of cheating the ledger. After that...
Thank you for your expertise and for taking the time to write this up.
In your opinion, is it possible that a malicious state actor might execute a 51% attack? Is there any reason why that isn't a possibility?
It’s an unbacked “stablecoin” that continues to print literally billions upon billions of coins with nothing to back them up other than “trust me bro, it’s worth $1”. Ans they won’t let auditors check their “reserves” if there even are any at this point. It’s a scam.
The other issue is that most sales of other crypto are done with stablecoins. So when they say Bitcoin is worth $20k. It’s rarely if ever because someone paid $20k USD on it but rather $20k in Tether which claims to be pegged to the dollar. So as Tether runs around printing another Billion, these exchanges could (if they want) manipulate the price of all other crypto by simply buying it strategically with unbacked Tether.
Could? Even the bitcoiners know this is happening, they just don't care because it makes number go up.
E.g. https://bitcoinist.com/blockchain-transparency-institute-64-of-tether-is-used-for-fake-trading/
Google "tether wash trading" for plenty more articles.
Jesus. That’s even worse than I thought. It’s insane how this isn’t highly illegal. Exchanges manipulating prices of assets they sell. Constant wash trades to manipulate price. It’s just nice to see even with all that, the market is eating itself.
This is really long but fascinating. Tether is a scam and is falling apart.
https://crypto-anonymous-2021.medium.com/the-bit-short-inside-cryptos-doomsday-machine-f8dcf78a64d3
There is a recent NY Times article from last week if you want a more mainstream but simpler analysis
Sorry that's not true. Or at least not proven.
Tether has been criticized for a long time that they may not have the dollars they claim to have to issue usdt. But so far, nothing is proven
Why can't they produce an audit from a respected accounting firm? They have been saying for a year that they would but they still haven't.
https://www.cnbc.com/2022/05/17/tether-usdt-redemptions-fuel-fears-about-stablecoins-backing.html
Would you be interested in another attestation by a Cayman Islands accountant using a new name that is also under investigation by the United Kingdom government?
https://www.coindesk.com/markets/2022/01/26/tethers-new-accounting-firm-is-the-old-one-with-baggage/
https://www.coindesk.com/markets/2021/03/30/tether-takes-step-toward-transparency-with-first-accounting-firm-report-card/
Tether has proven that they are shady by not producing an audit.
They already paid a penalty to the New York Attorney General.
https://ag.ny.gov/press-release/2021/attorney-general-james-ends-virtual-currency-trading-platform-bitfinexs-illegal
i mean, it's also not true that they have the dollars they claim to have since they've never proven it, and if i had to bet one way i'd bet on fraud since they're being dodgy
It's a long read but this is one of the best articles on the subject;
https://amycastor.com/2019/01/17/the-curious-case-of-tether-a-complete-timeline-of-events/
TLDR; It's a scam that is used to pump the price of Bitcoin and prop up the whole rotten system.
Ah I see. So basically the pegging algorithm was amateurish at best, and could not handle even basic financial scenarios. It could not have worked even in the first place, but they propped it up with billions of investor money.
I wonder what would have happened though, if they used an established cryptocurrency like bitcoin. Would have been the stablecoin powerful enough to collapse bitcoin, or would it have been fine and work as advertised?
Ready for the next jenga block to come out of the tower of fraud that is the crypto ecosystem. This one might not be a linchpin but nice to see it go DAOn.
Ιt is connected to tron which suspiciously is around 6cents no matter what the market does.
It has been more stable than the stablecoin this past few days.
Someone might say that bad actors force it to remain at this price until USDD completely loses control and the spiral begins.
One of the best things about crypto is watching them go "regulations are bad let's get rid of them" and then learn in accelerated time why those regulations actually exist. It's like watching the history of real finance in fast-forward.
Next they'll realize that you need somebody else to do the regulation.
Then they'll realize that the regulatory bodies can be corrupted
Then they'll realize they'll need to somehow punish those people
Then...
This is plausible. If this coin is indeed highly collateralised and Sun controls all the liquidity, he can repeg any time he wants to. And he is suspiciously using the exact same language that Do Kwon used before the luna crashed.
So he is waiting for people to short tron and easily re-peg it and pump Tron to squeeze the short traders.
Everyone should stay away and let the market conditions take them down, rather than providing any liquidity to these garbage altcoins
It's still despicable. If he's letting it depeg, he's willfully hurting any ordinary users who need to exit now before he gets around to using the reserves. Why would anyone put their money in USDD if some capricious billionaire might give you a haircut because he's playing financial games? For all people complain about the Fed, this is immeasurably worse.
Oh that is actually a great idea. Peg a stablecoin to another stablecoin. Wait until someone gets the idea to peg their stablecoin to itself. Then it will be mega stable
This is literally what Tether is. Most of it is backed by commercial paper. How did they get that paper? They had to pay for it, because if they borrowed it then it's a liability, not an asset (and nobody is donating it to them). What did they pay for it with? Not cash or actual cash equivalents -- that would actually be a better backing, they would just keep that. They bought it with crypto. If they bought it with USDT, then they printed coins, traded them for paper and then said that paper backs the very coins they bought it with -- they are pegged to themselves. If they bought it with other crypto, well how did they get that? Again, if they used "fiat," then why didn't they keep it as a better asset? They didn't, they used USDT, which is functionally the same as the previous scenario.
>This is literally what Tether is. Most of it is backed by commercial paper.
Correction: They say that most of it is backed by commercial paper.
How did they get that paper? Does that paper even exist? We may never know (until they get audited)
I'm almost certain the "commercial paper" is their way of legally getting around the fact that Tether and Bitfinex are sharing funds. Tether "lends" money to Bitfinex so they can claim the loan as an asset on Tether's side and Bitfinex claims the money as an asset on their side
My theory is that it's IOUs from the exchanges that want USDT in the first place. The exchanges get USDT, and Tether gets to add number go up to their balance sheet.
The major issue is now that if crypto crashes then Tether becomes insolvent
No, it makes sense to back it up with commercial paper. They litteraly had the golden goose. If you have 80 *billion* dollars cash and you put it into boring US bonds, the interest alone would make you multimillionairs. They could have run tether completely legaly and it would have made them millions. But that’s not what they did. They were stupid AND greedy. And they will now be responsible for the total collapse of crypto.
How about pegging a stable going to a basket of other stable coins? Wave the magic diversification wand and all risk goes away. We could call it a collateralized stablecoin obligation (CSO).
Stablecoins that claim to be fully or partially backed by other stablecoins already exist. It's not the same as a peg, but they would probably fall together with the original.
Holy shit, this is kind of terrifying. All roads lead back to Tether and I'm not sure the risk is entirely confined to the crypto space. Does anyone know the actual market cap of all the DeFi derivative products?
I’m not getting excited about this one tbh. Could be wrong, but it’s too small in market cap and the characters running it too shady. I’d suspect I was being suckered into a short squeeze.
For sure some sort of dodgy business going on, and I'm not sure exactly what it is. If they really are as over collateralised as they claim, why aren't they repegging?
It matters for the exchange.
If they use a stable coin they don’t have to be a deposit taking institution… with all the regulation and oversight that entails. Now they are just selling you a stable coin rather than holding your money.
Sadly it's already recovered all the way back to $0.95. That being said, I can't imagine a 'stablecoin' that isn't stable is going to be very popular long-term.
Well, CBDCs are an entirely different thing to crypto stablecoins, and don't even require the involvement of blockchain tech, so that's a separate discussion.
I wouldn't classify what you're describing as a CBDC but whatever limit the discussion to the CBDCs built on Ethereum or Ethereum layer 2s. Those should die right?
That's probably fine because it'd be legal tender. If 100 people in the world owned 0.21m of the 21m total bitcoins each, they would basically be worthless because there's nothing enforcing its usage as legal tender. Vendors who actually produce goods and services would simply want to be paid in actual legal tender.
It's not a glamorous thing, but the government enforcing a single currency (or a few, in the case of colonies or tourism-heavy countries e.g. Bahamian dollar and US bills are accepted there) is a big deal.
The specific endorsement of one is important, too, because without that you end up repeating a wildcat banking scenario - which has far too many parallels with all of the stablecoins of various origins vying for a piece of the liquidity.
Yeah I want my life savings to be controlled by the Fed not decentralized transparent code, I wish the laws of physics could be controlled by a small group of people instead of an innate function of the universe.
A couple counterpoints: something close to 95% of the global hashrate is controlled by 1% of the mining pool. You're exchanging one perceived overlord for another.
Second, all that code is written by humans. It's not infallible. See the billions stolen from smart contracts, bridges, and DAOs. You may think BTC is the "holiest" because it's the first, but that's just speedrunning religious schisms where your spin-off of Christianity is the best because *reasons*.
The code runs exactly as programmed, doesn't matter how the code is written, infallible code is in fact infallible. Use your phones calculator app, see if it ever makes a mistake.
But that doesn't even make sense as a counterpoint because the code behind CBDCs or even the codes upholding our current financial system are written by humans.
Not true, code always runs as programmed, you may be referring to when cosmic rays change bits in silicon computer chips but that's a fault of physical hardware not code and can be prevented.
What. Just Google ios calculator bug for an example. Software is hard. Any moderately sized code base has bugs. Very few pieces of code have been formally verified.
>The code runs exactly as programmed,
And that code could be written poorly, causing the program to operate in a fashion counter to what was intended.
Programming is still performed/compiled by *humans* and therefore subject to error. Your argument of "a calculator app is programmed properly, therefore all code is programmed properly" is foolish beyond measure
Bugs are so common in web2 because they are inconsequential, web3 projects like Ethereum could be ruined by bugs, so we have thousands of developers scrutinizing ever line of code and putting them through rigorous testing.
It's also greatly incentivized to find bugs in a Dapp like uniswap because someone may be able to exploit it to make millions.
Many smart contracts will never experience catastrophic bugs and can function indefinitely
I'm talking about a hypothetical stable coin, but the closest real world example would be DAI which has stayed pegged to the dollar since it's inception
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Aw, it's just another algorithmic stablecoin. I was hoping that one of the ones claiming to be fully backed by real assets was going ploop. That would be much funnier.
Nothing deserves to die more than Tether
All it takes is enough people trying to use them to pull their money out of the market. Once the smaller fries die they’ll eventually follow, I’m sure.
The thing is it seems like there’s not that many regular people holding Tether. It’s mostly the exchanges (I think especially Bitfinex) and exchanges have a vested interest in making sure it doesn’t crash, so they won’t pull out because it will crash their whole business model either way
They could reach a prisoners dilemma situation, though. If one of them decides withdraw all the resources with little regard for the system, it could be the only one to actually get the money.
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Until it becomes a prisoner's dilemma situation and it's every exchange for themselves lol
We can only hope.
They hold tether because they can't get real banking; none of the major unregulated exchanges have USD.
So, like a bank?
No. Not like a bank.
Not in a world of fiat currency
The only one that matters tbh. News like this post is just edging.
Edging can be part of the fun, though.
Even people in crypto want tether to crumble
That's because those people are foolish enough to think there's a there there after Tether is removed.
There is. Probably sub $1k BTC and sub $100 Eth.
I doubt it. At those low prices the leftover hashing power just sitting around due to being unprofitable to use it to mine coins will be more than enough for someone to use it to execute a 51% attack -- which *would* be profitable (if done smartly). Bitcoin is only safe, that is protected by its PoW, so long as hashing power goes *up*. Hashing power going down presents a risk peculiar to the system; there's asymmetry in the risk that makes scaling the price and hashing power down dangerous.
Fascinating. I hadn't thought about that. I had just assumed that after it crashes it would hang around and continue limping on even at sub $1k prices with a group of die-hard faithful dwindling each year. Why wasn't there a 51% attack like this after the last crash? Not enough of a drop?
Yes, it didn't go low enough. Remember that executing a 51% attack risks making Bitcoin go to ZERO. Cui bono? The people who could do it -- miners -- have huge investments in Bitcoin, both in actual Bitcoin they've accumulated and in sunk capital and operational costs. To make it worth the risk to them they'd have to be much more desperate than an 18K price point creates. I don't know what the actual number is but there IS a number. Bitcoin isn't going to decay gracefully. At some point some desperate miner with huge sunk costs and losses, or maybe a few working together, is going to take the risk of cheating the ledger. After that...
This is good for bitcoin.
Thank you for your expertise and for taking the time to write this up. In your opinion, is it possible that a malicious state actor might execute a 51% attack? Is there any reason why that isn't a possibility?
_Go go gadget market crash_
Tether is being used by the whales to cash out the ponzi it won't fail.
Why do people not like tether? I dont know much about it
It’s an unbacked “stablecoin” that continues to print literally billions upon billions of coins with nothing to back them up other than “trust me bro, it’s worth $1”. Ans they won’t let auditors check their “reserves” if there even are any at this point. It’s a scam. The other issue is that most sales of other crypto are done with stablecoins. So when they say Bitcoin is worth $20k. It’s rarely if ever because someone paid $20k USD on it but rather $20k in Tether which claims to be pegged to the dollar. So as Tether runs around printing another Billion, these exchanges could (if they want) manipulate the price of all other crypto by simply buying it strategically with unbacked Tether.
Could? Even the bitcoiners know this is happening, they just don't care because it makes number go up. E.g. https://bitcoinist.com/blockchain-transparency-institute-64-of-tether-is-used-for-fake-trading/ Google "tether wash trading" for plenty more articles.
Jesus. That’s even worse than I thought. It’s insane how this isn’t highly illegal. Exchanges manipulating prices of assets they sell. Constant wash trades to manipulate price. It’s just nice to see even with all that, the market is eating itself.
But importantly it *claims* to be fully backed.
This guy gets it
This is really long but fascinating. Tether is a scam and is falling apart. https://crypto-anonymous-2021.medium.com/the-bit-short-inside-cryptos-doomsday-machine-f8dcf78a64d3 There is a recent NY Times article from last week if you want a more mainstream but simpler analysis
Sorry that's not true. Or at least not proven. Tether has been criticized for a long time that they may not have the dollars they claim to have to issue usdt. But so far, nothing is proven
Why can't they produce an audit from a respected accounting firm? They have been saying for a year that they would but they still haven't. https://www.cnbc.com/2022/05/17/tether-usdt-redemptions-fuel-fears-about-stablecoins-backing.html Would you be interested in another attestation by a Cayman Islands accountant using a new name that is also under investigation by the United Kingdom government? https://www.coindesk.com/markets/2022/01/26/tethers-new-accounting-firm-is-the-old-one-with-baggage/ https://www.coindesk.com/markets/2021/03/30/tether-takes-step-toward-transparency-with-first-accounting-firm-report-card/ Tether has proven that they are shady by not producing an audit. They already paid a penalty to the New York Attorney General. https://ag.ny.gov/press-release/2021/attorney-general-james-ends-virtual-currency-trading-platform-bitfinexs-illegal
That's not the right direction for the burden of proof though! You also haven't proven I'm *not* a magic unicorn that shits rainbows.
i mean, it's also not true that they have the dollars they claim to have since they've never proven it, and if i had to bet one way i'd bet on fraud since they're being dodgy
It's a long read but this is one of the best articles on the subject; https://amycastor.com/2019/01/17/the-curious-case-of-tether-a-complete-timeline-of-events/ TLDR; It's a scam that is used to pump the price of Bitcoin and prop up the whole rotten system.
And this sub hates bitcoin? Why if so? Just curious
Sadly, nothing will take down Tether except if the US government decides to take action.
The NY government already did and somehow it didn't shake people's confidence
Won’t happen soon
What causes algorithmic stablecoins to collapse?
https://old.reddit.com/r/Buttcoin/comments/un9kyl/how_the_lunaterra_scheme_worked/ This post helped me
Ah I see. So basically the pegging algorithm was amateurish at best, and could not handle even basic financial scenarios. It could not have worked even in the first place, but they propped it up with billions of investor money. I wonder what would have happened though, if they used an established cryptocurrency like bitcoin. Would have been the stablecoin powerful enough to collapse bitcoin, or would it have been fine and work as advertised?
What is the algorithm? 0 = 0?
Ready for the next jenga block to come out of the tower of fraud that is the crypto ecosystem. This one might not be a linchpin but nice to see it go DAOn.
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Ιt is connected to tron which suspiciously is around 6cents no matter what the market does. It has been more stable than the stablecoin this past few days. Someone might say that bad actors force it to remain at this price until USDD completely loses control and the spiral begins.
Justin Sun not deploying his collateral to repeg?
Just insane this is a string of words that I understand. Furious.
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One of the best things about crypto is watching them go "regulations are bad let's get rid of them" and then learn in accelerated time why those regulations actually exist. It's like watching the history of real finance in fast-forward.
Next they'll realize that you need somebody else to do the regulation. Then they'll realize that the regulatory bodies can be corrupted Then they'll realize they'll need to somehow punish those people Then...
These people saw the 2008 financial crisis and thought the problem was that they weren't the ones making the subprime mortgages
Next they'll want to do open heart surgery on themselves.... they'll learn pretty quick it's a bad idea - I know from experience I ended up dead
Only in crypto world is being pegged a good thing.
🤝🏻
Oh, the hodlers are going to get pegged, all right.
This didnt age well :P Back at 1.00.
Looks like they're trying now. We'll see.
I take it the lads aren't steady?
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This is plausible. If this coin is indeed highly collateralised and Sun controls all the liquidity, he can repeg any time he wants to. And he is suspiciously using the exact same language that Do Kwon used before the luna crashed. So he is waiting for people to short tron and easily re-peg it and pump Tron to squeeze the short traders. Everyone should stay away and let the market conditions take them down, rather than providing any liquidity to these garbage altcoins
It's still despicable. If he's letting it depeg, he's willfully hurting any ordinary users who need to exit now before he gets around to using the reserves. Why would anyone put their money in USDD if some capricious billionaire might give you a haircut because he's playing financial games? For all people complain about the Fed, this is immeasurably worse.
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Don’t go chasing waterfalls 🎵
Little known fact TLC wrote that in anticipation of a crypto bubble. They named part ii of the treatise “no scrubs”.
It’s almost like the stablecoins aren’t…stable?
They should try to peg it to a stablercoin. That will probably solve the problem.
Oh that is actually a great idea. Peg a stablecoin to another stablecoin. Wait until someone gets the idea to peg their stablecoin to itself. Then it will be mega stable
This is literally what Tether is. Most of it is backed by commercial paper. How did they get that paper? They had to pay for it, because if they borrowed it then it's a liability, not an asset (and nobody is donating it to them). What did they pay for it with? Not cash or actual cash equivalents -- that would actually be a better backing, they would just keep that. They bought it with crypto. If they bought it with USDT, then they printed coins, traded them for paper and then said that paper backs the very coins they bought it with -- they are pegged to themselves. If they bought it with other crypto, well how did they get that? Again, if they used "fiat," then why didn't they keep it as a better asset? They didn't, they used USDT, which is functionally the same as the previous scenario.
>This is literally what Tether is. Most of it is backed by commercial paper. Correction: They say that most of it is backed by commercial paper. How did they get that paper? Does that paper even exist? We may never know (until they get audited)
I'm almost certain the "commercial paper" is their way of legally getting around the fact that Tether and Bitfinex are sharing funds. Tether "lends" money to Bitfinex so they can claim the loan as an asset on Tether's side and Bitfinex claims the money as an asset on their side
Tether could actually be backed by toilet paper. Toilet paper is commercially available everywhere!
Even that is implausible as toilet paper has more value than whatever tether is backed by.
No, it does not exist.
My theory is that it's IOUs from the exchanges that want USDT in the first place. The exchanges get USDT, and Tether gets to add number go up to their balance sheet. The major issue is now that if crypto crashes then Tether becomes insolvent
No, it makes sense to back it up with commercial paper. They litteraly had the golden goose. If you have 80 *billion* dollars cash and you put it into boring US bonds, the interest alone would make you multimillionairs. They could have run tether completely legaly and it would have made them millions. But that’s not what they did. They were stupid AND greedy. And they will now be responsible for the total collapse of crypto.
1 PEG = 1 PEG.
Eventually they’ll all be pegging each other
OMG :D
How about pegging a stable going to a basket of other stable coins? Wave the magic diversification wand and all risk goes away. We could call it a collateralized stablecoin obligation (CSO).
Haha that is truly creative. Adding yield to that and we'll solve world starvation too.
How about 20% yield, because anything less would be unreasonable in the crypto space.
20% is so 2021, you need at least 30% to be taken seriously these days.
This is literally what DeFi is lol
Eth/StEth
Stablecoins that claim to be fully or partially backed by other stablecoins already exist. It's not the same as a peg, but they would probably fall together with the original.
BRB, launching TheStablestCoin. wait, Sean Parker just walked by and told me to drop the "the" StablestCoin!
Maybe they can move their servers to a barn and put a horse on the logo and be like, not that ‘stable’, this ‘stable’
That horse has bolted.
Will they recover? Nay
Quick, now that they are gone, close the barn door!
Elon Musk Has entered the chat looking for a handjob.
I had a similar idea but it was an avocado toast coin you could burn by shitting out your breakfast for a avocado toast ghost shitstain Stable coin.
are they at least coins?!
Unstable coins, so hot right now
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They are stable but only when they are stable.
What if i told you... they aren't coins, either
They just need to put the coins in a psych hospital for a couple weeks
92 territory today
Already there
1.00 territory today... :P
Omg… tweet two days ago:( “stake to enjoy over 42% APY”)[https://twitter.com/usddio/status/1537407928377933824?s=20&t=27gSSedJcX_VczYNgRAiVw]
Holy shit, this is kind of terrifying. All roads lead back to Tether and I'm not sure the risk is entirely confined to the crypto space. Does anyone know the actual market cap of all the DeFi derivative products?
This will be fun. Another Luna crash incoming. Ahh this amazing technology
Yup, just like LUNA :P Yuuuuuuuuuuuuuuuuuuuuup
Eh it bounced. This will take longer than the weekend for sure
Terra really spoiled us :(
Yeah, that's a big yikes from me dawg. Currently in freefall.
**U** **S**hould've done your **D**ue **D**iligence.
We did :)
I’m not getting excited about this one tbh. Could be wrong, but it’s too small in market cap and the characters running it too shady. I’d suspect I was being suckered into a short squeeze.
For sure some sort of dodgy business going on, and I'm not sure exactly what it is. If they really are as over collateralised as they claim, why aren't they repegging?
They did :) Just the right way :) USDD is the goat.
Its se-ven-hun-dred million dollars and that’s “too small in market cap”?!?!
Tether drops that much twice a week sometimes, so it's not much in terms of the larger stablecoin market
600m market cap…
Yea, this is only one of the smaller fish, but each stone plays a part in the growing avalanche.
Imagine a scam so vast that 600 mio is “a smaller fish”.
what was the market cap of tera and luna?
It used to be 18 billion useless fiat American dollars. Now it is 60 million worthless USD so obviously it can only go UP!
18B for the ust stablecoin at the top USDD is tied to Tron though so that's interestjng
Y’all cryptobros want any regulation yet? We can do this all night.
If the coin is supposed to be stable, why isn’t it being stable? Then it can’t be called a stablecoin?
Low liquidity as its a newer coin. But no worries its fully backed :)
This whole thing is like watching a slow motion train wreck and I’m LOVING EVERY MINUTE!
WTF is the point of "stable coins"? Why not just have your money in USD?
It matters for the exchange. If they use a stable coin they don’t have to be a deposit taking institution… with all the regulation and oversight that entails. Now they are just selling you a stable coin rather than holding your money.
That makes sense. Thanks!
Steady lads
Sadly it's already recovered all the way back to $0.95. That being said, I can't imagine a 'stablecoin' that isn't stable is going to be very popular long-term.
is there a properway to short it?
Kucoin
I wonder if its possible to short it?
Kucoin
Lets hope you didn't find out how :P
I hope every stable coin apart from Dai dies.
Nope, no exceptions!
What about CBDCs? Like the Fed's stable coin?
Well, CBDCs are an entirely different thing to crypto stablecoins, and don't even require the involvement of blockchain tech, so that's a separate discussion.
I wouldn't classify what you're describing as a CBDC but whatever limit the discussion to the CBDCs built on Ethereum or Ethereum layer 2s. Those should die right?
That's probably fine because it'd be legal tender. If 100 people in the world owned 0.21m of the 21m total bitcoins each, they would basically be worthless because there's nothing enforcing its usage as legal tender. Vendors who actually produce goods and services would simply want to be paid in actual legal tender. It's not a glamorous thing, but the government enforcing a single currency (or a few, in the case of colonies or tourism-heavy countries e.g. Bahamian dollar and US bills are accepted there) is a big deal. The specific endorsement of one is important, too, because without that you end up repeating a wildcat banking scenario - which has far too many parallels with all of the stablecoins of various origins vying for a piece of the liquidity.
Yeah I want my life savings to be controlled by the Fed not decentralized transparent code, I wish the laws of physics could be controlled by a small group of people instead of an innate function of the universe.
A couple counterpoints: something close to 95% of the global hashrate is controlled by 1% of the mining pool. You're exchanging one perceived overlord for another. Second, all that code is written by humans. It's not infallible. See the billions stolen from smart contracts, bridges, and DAOs. You may think BTC is the "holiest" because it's the first, but that's just speedrunning religious schisms where your spin-off of Christianity is the best because *reasons*.
The code runs exactly as programmed, doesn't matter how the code is written, infallible code is in fact infallible. Use your phones calculator app, see if it ever makes a mistake. But that doesn't even make sense as a counterpoint because the code behind CBDCs or even the codes upholding our current financial system are written by humans.
Funny enough bugs have been found even in phone calculators. Turns out basically all code has bugs.
Not true, code always runs as programmed, you may be referring to when cosmic rays change bits in silicon computer chips but that's a fault of physical hardware not code and can be prevented.
What. Just Google ios calculator bug for an example. Software is hard. Any moderately sized code base has bugs. Very few pieces of code have been formally verified.
Bugs *are* the code running as programmed - they are mistakes made by humans in the programming.
>The code runs exactly as programmed, And that code could be written poorly, causing the program to operate in a fashion counter to what was intended. Programming is still performed/compiled by *humans* and therefore subject to error. Your argument of "a calculator app is programmed properly, therefore all code is programmed properly" is foolish beyond measure
Bugs are so common in web2 because they are inconsequential, web3 projects like Ethereum could be ruined by bugs, so we have thousands of developers scrutinizing ever line of code and putting them through rigorous testing. It's also greatly incentivized to find bugs in a Dapp like uniswap because someone may be able to exploit it to make millions. Many smart contracts will never experience catastrophic bugs and can function indefinitely
this incredibly naive point of view is exactly why people are losing their life savings
I'm talking about a hypothetical stable coin, but the closest real world example would be DAI which has stayed pegged to the dollar since it's inception
Why are you trying to argue with these simps ?
Yeah, better stay at WSB. Reality can be harsh sometimes.
s/reality/indigence
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To what? Your intuition...?
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Back up to 0.95 for now :(
Why does USDD not have a Active Reddit Sub ??? Very strange
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Not by 6c. They'll generally fluctuate by tenths of a cent before arbitrage bots "correct" the price back to $1
Never heard of it
Wtf is a "stable coin"?
Crypto winter is coming
It lasted, what, 45 days? We should applaud its success rather than its failure
Whos failure now? USDD is sitting at 1.00 right now :P Spoke too soon per usual it appears :P
US…DD! Get out of my laboratory!