Tether Now Holds Over $5 Billion Worth of Bitcoin to Back USDT (But Should It?)

I was going to show that I hold over 50,000 usdt in my wallet, but I've converted them all to local fiat as I have a local transaction that might go as high as US $120k

usdt is a much better version of a dollar account in the bank (Eurodollars), as it trades 24/7/365 electronically

(same as physical US $ bills that trade 24/7/365 locally at 24 hours physical exchanges)

usdt also trades slightly higher (premium) than US $, incidentally usdc also trades at a premium but smaller than usdt

So, yes, I would buy and hold usdt as it's a fiat bank account

I find it fascinating all the attacks from the usdt haters that have never used or owned usdt in a crypto wallet

Same people that have missed out and continue to miss out on bitcoin because they do not do enough research

Their pain will continue

It's a bull market, you know


https://twitter.com/x/status/1775130014201053425
 
schizo said:
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decrypt.co

Arkham Intelligence data—which tracks the crypto giant’s wallet—reveals that the company now holds over 75,354 Bitcoin, worth more than $5.1 billion as of this writing, after the firm bought 8,889 BTC in the first quarter of this year.

Tether said last year that it would regularly allocate up to 15% of its net realized operating profits towards purchasing Bitcoin. The idea is to use the asset to hold in the reserves it uses to back its stablecoin.

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Does this makes sense? How can you use Bitcoin to back the stablecoin? Shouldn't it be the other way around? What should happen if Bitcoin drops significantly (like nearly 80% we saw in the aftermath of 2021 crash)? :rolleyes:
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if it's a significant minority of their holdings as compared to actual USD or non-crypto liquid assets, it make a lot of sense to me. It's diversitfication in their core competency. If you look at a basket of fiat currency to a basket of 5 most liquid cryptos, they are neg correlated, which is pretty intuitive for obvious reasons. And since it is their core competency, they should have the expertise to control a killer cost basis, so if BTC loses 80%, it's not the same as some yahoo who bought at 70K.
 
ph1l said:
Easy.
  1. Tether issues Tether tokens
  2. Tether uses the new Tether tokens to buy Bitcoin
  3. Now Tether is backed by Bitcoin

  4. Tether issues Tether tokens
  5. Tether uses the new Tether tokens to buy Bitcoin
  6. Now Tether is backed by more Bitcoin

  7. ...
What could possibly go wrong?:D
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This analysis is totally inaccurate. This is what UST did and that "stablecoin" is a colossal failure.
 
smacdtrader said:
This analysis is totally inaccurate. This is what UST did and that "stablecoin" is a colossal failure.
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They DO issue USDT against crypto collateral.

They also do have some reserves but we can't know how much.


The US treasury does not yet have the authority to take action against foreign crypto companies, however they do have the authority to take actions against foreign companies involved in aiding with russian military financing.

There's been an article how Tether is being used by Russians to evade sanctions a couple days ago.

Maybe this is a setup for imposing sanctions on Tether, who knows.


Why doesn't Craig Wright prove he is satoshi using the private keys? It's very simple, but he can't do it because he is lying

Why doesn't Tether prove they are legit through a financial audit? ....
 
I'm no fan of Russia, but I mean, those are US sanctions. USDT has not obligation to bow to the US govt. I guess until they do. But for the moment, free markets are what they are. An interesting thing about crypto is that they whole universe is kinda giving the US a lesson in free markets.

You may be right, and if they cannot back up their financial obligations, they will crumble. We are free to take that risk or not.
 
engineering said:
Massive revenue with almost no employees is a key indicator of a bubble.

See the French Mississippi company for an example.
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In this case, I have to disagree. Compare this to a bank with $100B in deposits. Think of the cost associated with all those accounts, and branches, and people, and then those depositors wanting a percentage of these high interest rates. And now consider Tether, $100B in deposits, not asking for any yield, no branches, and only a few engineers on the payroll to maintain the blockchain. As an added bonus, they don't even have to spend too much money on audits. :D

Every year, in this environment, they get to keep $5B in profits just from the interest rates. With 100 employees, that is $50 million profit per employee.
 
engineering said:
Massive revenue with almost no employees is a key indicator of a bubble.

See the French Mississippi company for an example.
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Your comparison does not hold water, since the French Mississippi existed when there was no internet or cell phones,

can you imagine telling someone back then of a company called Facebook that sells advertising and is worth over $1 Trillion or a company called Apple that does not sell any apples ,but electronic devices and is worth over $2.5 Trillion?

It sounds ridiculous, and yet, people still use arguments from ancient times, our favorite is Tulips btw, as a comparison

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Are you from the US?

Tether is the biggest global Internet-based USD checking account that does not pay any interest but it earns lots of interest income from "risk-free" US Treasuries

You do not need much employees for such a simple business model

The reason I asked if you're from the US is because you probably cannot relate when I say Tether is a global USD checking account, but as someone from the US and is now living in Asia, I have processed over 70,000 usdt to local fiat in the past few weeks at an exchange rate higher than the published official US $ exchange rate, how would you comprehend it?


NoahA said:
As an added bonus, they don't even have to spend too much money on audits. :D

Every year, in this environment, they get to keep $5B in profits just from the interest rates. With 100 employees, that is $50 million profit per employee.
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$6B, I think because they did not spend the budget allocated for the audit :D
 
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