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Comment by spaceman_2020 | Hacker News Reader

spaceman_2020

I've been deeply involved in crypto the past 3 years and everyone in the space knows that Tether is a scam. No serious investor holds USDT over USDC in their personal wallets. Tether only exists as a way to trade on centralized exchanges.

The problem is that everyone in the system is so deeply reliant on USDT that they will do everything possible to prop it up.

Honestly, the only thing that can bring down Tether at this point is either the collapse of one of the major central players (such as Binance) or government action.

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> everyone in the space knows that Tether is a scam

For those interested, Coffeezilla did a piece on Tether:

https://youtu.be/-whuXHSL1Pg

And yes, it’s a scam.

Hodlers seem to tolerate it because crashing Tether would impact their net value. It’s sad.

so BTCUSD is like $15-$16kish now

if anything happens to Binance, Coinbase, or Tether, it’s most likely going lower

I feel like a lot of people who still dollar cost average into cryptocurrencies shouldn’t. If you make $300k/yr, you can do whatever you want with your money in my opinion.

If you make $15/hr working part time, you probably shouldn’t touch crypto. The risk is too low. What’s the upside chance?

I agree with you - but I think you meant "the risk is too high" if you're a low income earner?

I just feel most people who are obsessed with crypto that I’ve come across in my personal life are some of the least financially responsible/educated people I’ve ever met

that and r/bitcoin comment sections are very delusional cult to me

Counterintuitively, the person making $300K/yr can just keep buying SPX every paycheck for the next 10-15 years and have a very cushy upper middle class lifestyle with a nice nest egg. For someone making $15/hr, crypto maybe their only lifeline to escape the quagmire of poverty. More so if that someone is making only a few dollars per day in a despot regime with weak currency management; then crypto* is truly a rare lifeline for them.

* I only trust BTC. There are some noteworthy projects like Ethereum who have earned benefit of doubt, but its better to stay away from rando shitcoins. Also stay away from centralized exchanges (Binance, FTX and the likes).

> For someone making $15/hr, crypto maybe their only lifeline to escape the quagmire of poverty.

Or help keep them there as they keep getting "scammed" out of their money.

Think about $15/hr people who bought anything other than Bitcoin when Bitcoin was at $60k+

Crypto has most likely been harmful for a bunch of lower class people.

> Think about $15/hr people

Actually let's think about them. What could they buy in Q4 2021 (when BTC was 60k+)? If they were in the US, then probably some random stocks or some index fund, which has gone down in value (-20% for S&P, to -65-70% for "blue chip" ones like TSLA or META). Definitely not real estate. And forget about commodities.

Outside the US? I'd wager similar scene in other advanced economies. I don't even know what good options they have in developing markets.

Even today, I'd wager that BTC* will have a better outcome than S&P over the next 10 years.

*to me, BTC is the only reputable crypto. ETH, if you understand how it works. Forget about everything else.

17.2 tonight.

18.3 right now.

In the past, the bitcoin price sometimes increased when there were rumors that a centralized exchange was insolvent, as people liquidated their positions and bought bitcoin to get their assets out of the exchange.

I don't have any assets on exchanges, but if I did I'd want to get them out now. If I have to choose an offline store of value that will still be worth something in five years, should I use Tether or bitcoin?

To finesse the idea of major central players whose downfall would collapse Tether:

Tether has remained relatively unaffected by major exchange collapses and disappearances over the years, including the very recent implosion of the world's second-biggest (after Binance) crypto exchange FTX. Barely a blip on their radar.

So I posit that Binance is probably the only exchange whose downfall may (may!) collapse Tether. And even then, Tether would be one among many, in that scenario.

Apart from that, the only entity whose collapse might also end Tether is perhaps "Tether itself". Unless anyone has other ideas? So it would seem to me that the government action is more likely to impact them than anything else at this stage.

This would be true if most people in the space knew what they were doing, instead most crypto investors aren't very educated and were probably only informed about the Technolgy when Elon was promoting doge coin

Which is why I'm talking about the bigger guys - the "smart" investors. See their on-chain wallet activity and you'll find that they almost never hold any Tether at all. There are almost no major on-chain pairs for $X/$USDT - it's all DAI/USDC (if stables).

> everyone in the space knows that Tether is a scam

People seem to say this every time one of these big crypto companies fails, yet it’s just plainly false. Tons of people put money into these companies and are left holding the bag when things inevitably collapse. At what point do we run out of rugs to pull and just agree the whole thing was a mistake?

because the best practices from 2011 are still the best practices in 2022 and nobody looses the assets held according to those best practices and everyone that doesn't follow them can be ignored

thats why people keep saying it

it just isnt different enough to say that frequently occurring new problems that were introduced by the concept discredit the entire concept. ATMs never solved skimming, lets write an article about user or bank losses every day about that and pretend it doesn't work well most of the time for most people just because you dont see articles about that and never use it yourself, silly idea right? It still works fine. Analogies compare dissimilar things with at least one similarity, in this case its an introduced problem that isnt solved but didnt change the course of its existence. Same for debit/credit card payment processing over the internet, lots of fraud, whether the user experience of reversal occurs or not, the problem isnt solved and the course isnt changed.

> ATMs never solved skimming

They actually did with the emv chipped cards and mutual authentication, not that this was your overall point but still.

So you've been involved in crypto since 2020 and not only are you at the top of the comment thread, you feel the need to "sanctimoniously" chair people on the subject? LMFAO. Yes please tell me more about how USDT is a scam and USDC isn't.

Wouldn't your name start as "Special Agent ----"?

It's a game of musical chairs, and as long as trading volume remains high, the music keeps going. The vast majority of USDT -> USD sales happen on exchanges, not via redemptions, so the question of whether redemptions will be valid is somewhat academic. Until it isn't.

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