Tether; this week I finally stopped to listen to the anti-crypto people about Tether and started with a few YouTube videos. The Coffeezilla dude sure did do a nice video about how shady this crap is, I don’t believe all the negativity but I also have no proof it's not there. Just because I want to believe everything is okay, doesn’t mean it is. From what I know about Tether now, I could type 5000 words on it; this blog is paragraphs because no one wants to read 4000 words on one topic. Tether Limited, an off-shore company is just printing money to buy other crypto coins and has never done an audit. My theory is, they don’t have to, they aren’t an American company and technically it operates like an international bank and uses many currencies as their backing. What gives America the idea that it has to be dollars that it’s backed by? Tether is using everything and when asked by New York to prove they have assets to back itself, another company called Bitfinex gave them what its needed to show it backed by assets.
Tether is a long story and most think, ‘Well if it ever collapsed, it’s only $70 billion and the total crypto market is in trillions”. Sure that’s true but it also proves there is a chance it could crumble. One thing people have used Tether for is to trade with rather than dollars. Let's say you see Bitcoin falling a bit and want to buy some, using dollars, you would be charged a small percentage fee for that trade. Then you see it going up and have made some profits, you decide to sell, and there is another fee. Well with Tether it’s just pennies to trade with rather than dollars in fees. So holding reserves of profits have happened in Tether rather than holding in dollars.
Why Tether matters because for the past year or so people have seen Tether printing machines go off when the Bitcoin price drops a bit. The Bitcoin market cap is almost $400 billion, and the Ethereum market cap is around $175 billion if all of Tether was wiped out it wouldn’t end crypto but would cause a major dip. USD Coin, another stablecoin is around $50 billion in market cap, and if Tether ever had a bank run; USD Coin would have one too. Stablecoins are shady to me because of how much crime can happen with them. If any regulation happens with crypto, I hope it’s the stablecoin transparency act.
The FTX guy SBF, Sam Bankman Fried, is speaking at a conference for the New York Times and BitBoy went down to the Bahamas to find him. I guess BitBoy found his car and the building he is in but hasn’t gotten an interview. BlockFi is going bankrupt also now because they were either doing the same stuff FTX was doing or were giving away too much in crypto staking. Genesis also is crumbling and it seems like crypto is at its bottom. I have been still watching the MIT crypto lectures and they all went table by table asking who they think invented Bitcoin. 3 tables voted for Cypher Punks, a group of people and 3 tables voted for NSA. Cypher punk because they are just known for cryptography and the same with NSA and how they have the best people. I guess it really doesn't matter who created Bitcoin but it really is an extraordinarily big invention the more someone thinks about it. Stocks can be a safer store of value in a crypto bear market, depending on which stocks because I think it’s a bear market for stocks right now too. The ones holding onto their satoshis and buying the dips during a bear market will come out on top when the market turns the other way. I was explaining to my stepfather John the other day about how if Bitcoin were to be used as legal tender then everything would be bought and sold in sats. Sats, or satoshis, are a single unit of Bitcoin and you wouldn’t say “this tea or drink is 0.000091”, it would be 91 sats.