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Comment by monstersinF | Hacker News Reader

This is a great table of information. It’s news to me that Tether is based on Ethereum tokens. If Ethereum falls out of favor and offers an appealing 51% attack, or if the proof of stake transition has a vulnerability, would this affect Tether spectacularly and then impact BTC and all other CCs?

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Ethereum powers 95% of the work in the cryptocurrency space. If Ethereum has a fundamental flaw then it would be quite tragic for the entire industry and might cause years of chaos and set back crypto for a generation. Thankfully Ethereum is one of the most scrutinized and well tested systems ever made so the chances of that are extremely low and there's not any reason to worry.

I started learning how to program some solidarity for fun and just to understand the whole concept better. While I agree that in the short-run 1-5 years, it’s extremely unlikely that something wins agains ETH, but... in the long run, 10-20 years, it’s a lot harder to know.

Not sure what that means for anything, but it’s important to remember that what we consider the gold standard today, BTC, ETH, they may be tomorrow’s tin.

This has happened before. A few years ago many did not understand the concept of smart chains and rather invested into new litecoin clones, all of which are replaced in popularity by smart chain tokens only a few years later. I agree but i think 5 years is enough to disrupt everything.

It used to be.. Tron is almost 50% now of USDT issued.

https://wallet.tether.to/transparency

Also USDC is on several chains as well including Stellar.

USDT is a fraud though, I wouldn’t believe anything associated with it.

Tether is as legitimate as any non-US, non-regulated, company unable to do business with reputable banks or auditors could be. The NY AG case went a good way to legitimize them.

Errr, what. Here's a quote from the NY AG, I'm not sure how this translates into your interpretation of the case.

https://ag.ny.gov/press-release/2021/attorney-general-james-...

> “Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines,” said Attorney General James. “Tether’s claims that its virtual currency was fully backed by U.S. dollars at all times was a lie. These companies obscured the true risk investors faced and were operated by unlicensed and unregulated individuals and entities dealing in the darkest corners of the financial system.

Yes, tether (and usdc + dai stablecoins) relies on ethereum for security.

Edit: this is one of the reasons I’m optimistic about the future of ethereum. The stablecoins have become so critical for defi that it’s hard to imagine another platform (like polkadot) gaining critical traction needed to overtake it.

Serious question from a crypto noob - what's the point of defi systems if they're all built on stablecoins and depend on the value of a fiat currency at the end of the day? Especially for permanently-deflationary coins like BTC?

You can use them without being affected by Bitcoin's volatility on the same kind of blockchains and smart contract platforms.

And you can borrow stablecoins for your BTC without selling it.

Non-pegged stablecoins are now starting to be experimented with on Ethereum, Rai and Bank/Float, for example.

They're built on Ethereum, not stablecoins. The stability of the network currently relies on stablecoins only in the sense that people use stablecoins to store wealth in situations where fiat is more stable than crypto.

Cynical take: a lot of it is effectively financial cargo-culting -- building structures which mimic traditional financial products, like banks, loans, and investment funds, in the (fruitless) hope that this will create value.

I thought the same thing about NFT art trading. But if everyone is part of the cargo cult and the cult is making real money then is it still a cargo cult?

> But if everyone is part of the cargo cult and the cult is making real money

False premise. Some people are making money, but only at the expense of others. There is no value being created here.

One of the stories about how cargo cults were first noticed was someone needing to do an emergency landing, noticing a runway that wasn’t on their charts, landing, and finding the locals had built it so that aircraft full of cargo would land on it.

Given it was successful despite being a cargo cult (the plane landed QED), by symmetry the ability to make money with cryptocurrency doesn’t make it not an economic cargo cult.

(One must do more that this to show that it is a cargo cult, rather than that it is still possible for it to be, which I say despite liking the cargo cult comparison and being generally very against cryptocurrency).

Have you seen fiat fonds these days? Most stablecoin defi looks a lot more promising than anything my bank has to offer.

As far as non-ERC20 stablecoins go, Terra’s UST is gaining a lot of traction this year as well.

Terra Labs and the Luna token is one of the few projects out of this latest cycle that has really energized me.

I was completely blown away with the design of the Anchor protocol that they just launched

I really hope that project continues its success.

https://wallet.tether.to/transparency

Tron is growing ... USDC is multichain as well.

I believe the answer is yes, but this receives fairly little attention because people are more concerned about Bitfinex treasury and the USD backing than they are about the ethereum dependency

Tether is on more networks. I think the most popular one is TRON (most Tether is traded on TRON) but I might be wrong

edit: Yeah I remember correctly

https://www.coindesk.com/tron-ethereum-tether-transaction-co...

The irony of most cryptocurrency market cap depending on mostly scam currency TRON is not lost upon me.

Justin Sun is good at promoting.

>Justin Sun is good at promoting.

In less PC-ridden times, this would just have been:

    "Justin Sun is a bald-faced liar."

Most Tether is on Ethereum:

https://wallet.tether.to/transparency

Most Tether volume is also on Ethereum, as the article above notes:

>>Notably, the total value of tether transacted on Ethereum is still larger than Tron, signaling that primarily smaller transactors are migrating. Meanwhile, parties executing larger transactions who can presumably afford higher fees seem comfortable continuing to use Ethereum.

The big issue is that there's simply no space on Ethereum for smaller transactions. Hopefully some of this volume will migrate to Ethereum's zkRollups, namely Loopring and zkSync, which increase Ethereum's maximum throughput from 30 to 3,000 ERC20 token transfers per second.

Ah. Okay then

Not really as Ethereum is a public ledger, with copies of the full transaction history distributed across thousands of computers around the world, so any malfunctions can be easily identified and fixed.

If consensus was so easy we wouldn't need a blockchain or mining.

It's because Ethereum uses a blockchain and mining that there are thousands of computers with identical copies of the transaction history.

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