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Comment by guildenstern | Hacker News Reader

There is absolutely no chance that bitfinex and/or Tether will be acquired by any legitimate institution, much less Coinbase. They are far to steeped in fraudulent behaviour to ever go legitimate without regulatory punishment.

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Why not? Circle (US based) bought Poloniex which is one of the biggest Tether exchanges.

If you're Coinbase and you get to buy Bitfinex/Tether at a firesale price + pay some fines to the SEC if needed, why not?

Bitfinex isn’t a company that ignored some AML requirements and they’re not a company just using Tether. They’re the company responsible for tether, they are the creators of Tether. Tether is hugely fraudulent, it’s foundation is fraudulent, they haven’t just avoided some regulations. There’s no way that Coinbase or any other legitimate institution would open themselves up to being responsible for that.

Who has Tether defrauded? I agree Tether may have just issued without backing, but they don't promise being able to withdraw. So who is actually being harmed? And why is it unfixable? What if Coinbase promised to completely cover any usdt shortfall?

I think the criticism from the regulators has to do with the fact that you cannot create something representing a dollar without approval from regulators and without requiring anyone to do KYC - effectively circumventing all KYC/AML systems in place in the traditional financial system.

What's wrong with Poloniex exactly?

Do you have any evidence to support that statement?

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