Comment by albertwang | Hacker News Reader

Comment by albertwang | Hacker News Reader

Link to the research paper: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3195066

From the abstract: Using algorithms to analyze the blockchain data, we find that purchases with Tether are timed following market downturns and result in sizable increases in Bitcoin prices. Less than 1% of hours with such heavy Tether transactions are associated with 50% of the meteoric rise in Bitcoin and 64% of other top cryptocurrencies. The flow clusters below round prices, induces asymmetric autocorrelations in Bitcoin, and suggests incomplete Tether backing before month-ends. These patterns cannot be explained by investor demand proxies but are most consistent with the supply-based hypothesis where Tether is used to provide price support and manipulate cryptocurrency prices.

What if most BitCoin owners know that buying Tether this way is a way to bump up Bitcoin. Therefore they decide to do their part. They don't need to agree on anything with anybody they just understand this is THE way to bump up the price of BitCoin. Is it still a conspiracy?

Yeah, in the same way people might understand how MLM's work but don't need to explicitly agree to take part in the less savory aspects of why it might be lucrative. You can understand the game and play it with other actors without any set of well defined rules, as long as you're all working towards relatively the same outcome and you all have the same assets that need to be treated in a particular way to get that outcome ("I'll get mine").

But, I don't think that's sufficient to explain what's been happening in cryptocurrency markets. There's a reason analogous regulations exist in Real (TM) trading. As it stands, it's too easy for bigger (or sufficiently pocketed) entities to manipulate the markets. There's no way to stop them, no way to REALLY track them, and there's every reason for them to do it as long as people keep buying into these coins/exchanges.

I'd wager that people who don't think this is happening are blindlingly optimistic about what's going on.

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