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Comment by new2this | Hacker News Reader

The central allegation is that Tether would print coins for themselves that were not backed by USD and then buy BTC. Thus, artificially propping up BTC in a price range where they could then quickly sell, pocket profits, and stor the money to back the Tether they just printed.

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In other words, gaming the system is pretty easy when you're printing/minting the money needed to do it. This is what puts crypto in a league of it's own.

Isn't this what the Fed does?

Not that they're in the same league, but it feels like the same sport.

Nope. The Fed does not print money for it's own personal/private use or to directly benefit it's members.

The Fed is incentived to profit from economic growth and increased financial activity --- which theorectically works to everyone's benefit. Individual Fed board members are restricted from personally investing in the financial markets to avoid the appearance of any conflict of interest.

  > The Fed does not print money for it's own personal/private use or to directly benefit it's members.

You're referring to the small handful of people on its Board of Governors, but the member banks are private institutions run by private individuals who absolutely have investments.

Any policy changes the Fed makes affects all these private member institutions equally and at the same time.

They can guess but it's not possible for these private institutions to "know" what policy changes the Fed will make because even the Fed doesn't know until they meet and vote. It's not practical for one of these institutions to individually request or receive special treatment or favors from the Fed. There is no one individual at the Fed empowered to grant any such request. Making any such attempt would subject the institution to having it's banking charter revoked.

Compare this to crypto where exchanges can and do grant themselves special treatment and secret monetary favors without any permission or oversight whatsoever.

"No special favors" for member banks is hard to swallow after seeing the fallout in 2008 for everyone except those responsible.

That's not a defense of crypto, it's an acknowledgement our banking system is corrupt. It's nice that it magically always works out for those in the know though.

Agreed. The 2020 CARES Act was ~1/3 of 1 month's rent for the peasants and some innumerable amount of money, yes, printed for a secret list of then-Treasury Secretary Mnuchin's choosing. Plus plenty of good provisions. And in 2008, a more transparent yet still obvious use of "quantitative easing" helped the ultra rich become ultra richer. One can claim it's for all of our benefit.

Crypto has plenty of issues, but these defenses of the corrupt use of the Federal Reserve is pretty silly.

But then some people are selling BTC against tether. And, at some point, want to exchange tether with USD.

So I understand that Tether is shit if it’s true but it has nothing to do with bitcoin.

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