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Comment by brndnmtthws | Hacker News Reader

There's a lot of FUD, but very little evidence of wrongdoing. It seems mostly like one person on a campaign to discredit Bitfinex because of some grudge. https://twitter.com/Bitfinexed is the person spreading the FUD, they're also shitposting all over Reddit and elsewhere. Seems like now the 'media' is going along for the ride and enjoying the ad revenue.

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This "FUD" could be easily dismissed by showing a bank account statement containing these $814M. The fact that Bitfinex doesn't do that means they have something to hide or are in serious trouble.

No, it's pretty normal for private companies not to share that kind of data.

Not in financial businesses it’s not.

Legally - yes, but when such company act as a semi-bank, costumers can reasonably expect some transparency, especially when rumors are going around.

They're under no obligation whatsoever.

obligation != trust.

I wouldn't trust private company that claims to back crypto currency 1-to-1 with USD, but doesn't back these claims with numbers in any way. The fact that they are not legally obligated to do so doesn't change that.

We're in agreement, but lack evidence is not evidence of wrongdoing.

It's not proof, but "you just have to trust me" when talking about hundreds of millions of dollars is potential evidence of something shady.

Add to which, "We have no obligation whatsoever to exchange your Tether for USD, and you have no right of redemption for this, either."

"They're under no obligation whatsoever."

Then we can assume the money does not exist, and that it's an $800M fraud.

Just so that I'm clear:

- Skepticism about the tether reserves is FUD,

- meaning that we should believe it is there.

- But we cannot ask for proof of an easily verifiable claim that the money exists, because certainty that it exists is a trade secret.

Is this an accurate reflection of your position?

I'm merely pointing out that the majority of the fear surrounding this issue seems to originate from one person with an axe to grind.

In other words, "let's ignore the message and shoot the messenger"?

But there's a wider economic ecosystem at risk. By not sharing and proving that Tether is in fact really tethered, they're leading people to the conclusion that there's 800M US artificially pumped, artificially PRICED into some currencies.

That has the effect of adding 800M of fakeness, which may not be a big deal given the market caps of these cryptos, but perhaps more importantly it has the effect of weakening faith in the crypto project.

It's normal for companies to not share that kind of data to everyone - however, in this case it's normal for a trusted (by public) auditor to publish that all this data has been shared to them and that they vouch that it's appropriate.

"FUD" = Fear, Uncertainty, Doubt. That does not imply that spawning FUD means it is some sort of unfounded gossip. Customers should be fearful, uncertain, and doubtful of a completely unregulated company that acts as a bank of sorts with no proof that it has any of the reserves it claims.

So yes it is FUD. In this case it is good FUD. And in this case Bitfinex can easily quell it, but chooses not to which doesn't bode well for them. Could tether be perfectly legit backed by solid reserves? Yes. But this must be verified.

[flagged]

Feel free to troll through my internet presence. There's a link to my bio in my HN profile.

I have never used Bitfinex, and do not own any USDT.

All bitfinex has to do is prove they have the money. but they can't do that.

They have publicly refuted the claims, but people are still running around with pitchforks.

Because public refutations aren't worth anything. If the money doesn't exist, they have every incentive to lie.

"Our bank is totally solvent, honest" doesn't work during a bank run. Real banks show their books to regulators.

They have not publicly refuted the claims, because a meaningful refutation cannot consist of their own statements about their own situation - it must include a trusted third party/auditor claiming that they have verified books and assets of Tether, and have verified that the claims match reality.

They’ve publicly denied the claims.

They absolutely have not refuted them. In fact their continued refusal or inability to do so is (weak) evidence in support of the claims.

Dude, just because someone defends something doesn’t mean they’re on payroll. That’s incredibly immature

>Are you on Bitfinex' payroll?

Sorry, but that's hurting the conversation.

Whether the accusations are true or not, I wouldn't hold a single dollar in Tether after reading this on their website:

> “There is no contractual right or other right or legal claim against us to redeem or exchange your tethers for money. We do not guarantee any right of redemption or exchange of tethers by us for money.”

I don't use tether either, but this seems like total unsubstantiated nonsense to me.

Then you should talk to Bitfinex/Tether about it, because it's on their website.

They must be spreading FUD about themselves, right?

See the second paragraph of section 3 here [1].

[1] https://tether.to/legal/

I have an LLC I started that makes a coin (Тедер) I'd like you to use for transfers between exchanges. Here are the details:

- Тедер is backed 1:1 with USD.

- 800M of Тедер exists

So, what is the problem?

- My LLC has the USD, trust me. But I won't prove it. Because I don't have to.

- Also, my terms state we make no agreement that we will honor the backing.

So does that sound like something you would invest in?

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