'But Mr. Krug, at Pantera Capital, said that if Tether were really being used by investors, they would probably also want to buy new Tether when the markets were going up, which has not been the case. Also, they would not always want it in exact increments of $100 million, as has been the case.
“After you see this enough times, you just start to wonder what’s really going on here,” Mr. Krug said.'
I'd listen to the folks at Pantera, they are pretty sharp.
> We vary N from 1 to 24 hours and examine the p-values. [.....] there are a number of periods where the p-values are significantly below 0.05 and we reject the null hypothesis for those periods.
Is it p-hacking to vary N and find low p-values? If its not p-hacking, but a valid analysis with predictive power, then wouldn't it make a good trading strategy to watch the tether wallet and buy btc whenever new issuance happens?
just look at the weekly chart and you’ll see a peak pattern. another pattern can be seen in the daily chart, flat periods that don’t exist on stocks like Nike or apple
"Long before news of the subpoena, Bitfinex, which is believed to host more trading than any other Bitcoin exchange in the world, had gained a reputation for a lack of transparency and a confusing structure, with European executives, offices in Asia and registration in the Caribbean."
Oh boy this sounds like the banking system I was hoping cryptocurrencies would supersede...
> Also, they would not always want it in exact increments of $100 million, as has been the case.
Not to question the Tether story but I don't understand this line of argument. What is the problem with exact increments?
Sure, the tokens have to be issued only if the issuing conditions are met. But given the number of hacks, wouldn't people want to use the issuing account sparingly? You know, use the issuing account to issue tokens in fixed increments to build up reserves. The move these reserves to be held in another account.
The theory behind tether is it's backed by US dollars so if investors send in 1234 usd they should be held in reserve and 1234 tether issued against them. If they are issuing them in lots of 100 million it suggests they were not bothering with the whole receive dollars from investors and hold them bit.
a. As per coinmarketcap, currently the largest BTC market is the BTC/USDT on OkEx. On looking closer, 3 out top 10 markets are USDT (excluding Bitfinex). So that is nearly 10% of only BTC liquidity gone.
b. As Tether and Bitfinex are connected so the exchange shuts down. It is the 2nd largest bitcoin exchange. So all that liquidity vanishes too. That brings our above total to 15%.
c. There will be many cross connected trades relying on USDT so my guess is the liquidity number will be higher, maybe even in 25-35% range.
d. This will cause panic and people selling BTC left and right. So BTC prices taking a huge hit. It might go down as low as 1-2k.
e. Most other cryptos are pegged to BTC. So with BTC liquidity gone they will take another huge hit too.
What I think would happen is people with Tether stuck on those exchanges would start trying to get out by two ways:
1) Cashing out to fiat, I don't know these exchanges well enough to determine if people actually managed to cash out their Tethers with real money in a meaningful sum.
2) Buying crytocurrencies available on these Tether based exchanges in order to get off these exchanges, which would actually cause prices to go up, but only in terms of USDT, not USD.
After that it really depends on what those folks would do next, they might choose to hold onto the coins or try to liquidate to fiat which would cause prices of coins on non-Tether exchanges to go down.
If tether pops suddenly, such as by the revelation that the supposed dollar account backing it was a sham, there may not be any cash to out. Simply no one will buy it, or only for pennies on the dollar.
Alternately, it might drag down other currencies by taking away the illusion of easy crypto-to-dollar exchange that tether offered, but other than that the dominant effect would likely just be investor panic.
So, no one knows how things will turn out! Such is finance. It makes for fun stories, at least.
Tether's market cap is around $2b... the crypto market as a whole clocks in at over $500b right now... what kind of effect could Tether really have, beyond the inevitable panic that will ensue?
The world economy was much larger than the market for US mortgage bonds, but when US mortgage bonds failed, the entire world economy tanked. It's not about relative sizes, it's about how intertwined the relationships are.
I recently created my own cryptocurrency, UCaetanoCoin (UCC), with a supply of 100 trillion and one coins, all owned by me.
I sold one to a friend of mine for $0.01 yesterday, which made me not only the richest person in the world, but also the first trillionaire, as the coins I own are valued in $1T USD.
And my UCC has a total market cap of $1T USD (and one cent). Then I exchanged a single coin with myself for $0.01.
As my coin has zero transaction cost and instant transactions (it's a badass coin), I traded it back and forth with myself 100 quadrillion times.
This generated a total traded value UCC-USD of 1 Quadrillion Dollars yesterday, more than any other security was ever exchanged in a single day.
Anyone wants to invest on my UCC? Here's my white paper:
The comment itself is sort of a rehashing of by now ultra tedious material, too. You're far from the only one rehashing it—pun intended—but it would be good if everyone doing it would stop. Repetition is the leading anti-value of this site.
I won’t charge you for consultation here. You should make a token system so people can earn token (somehow) and get rewards like iPhone and perhaps even a stack of American Dollar. Let’s partner with resturants, airlines, gyms and hotels. Every bite, every mile equals some arbitrary token that will expire in 180 days. We will develop a mobile game called crytoGo in which users can earn our token by mobbing Central Park and Settale Centeal Library.
The more active users are physically in the real world, the more trading happens. We will make our users live like a hamster running on a wheel.
We give people incentive to live and make money! No more sitting in the office 9-10 anymore! They get social and outdoor life, and we make our money.
This will take off. Don’t waste your time on Facebook. Any crytocurrency marketer tells you to invest in facebook campaign is stealing your money. Listen - find some viral YouTubers and Instagram users to back you. We will make an awesome logo like the Grumpy Cat.
Contact me privately if you would like a quote for a complete proposal. I am happy to work out the details with you. We can refine the bots for sure.
Everything is done behind Tor - even more secure than ever! Our servers are located in Sweden so do not worry about!
Just so you know: I have patented the idea and design of this system. So don’t think about copying. Trust me. My name is yeukhon. I have a B.S in Computer Science. K?
hi me and a group of investors, 1000 to be exact, want to acquire 40% of the coins. we can take the value of UCC to us$19999 dollars, contact me for further details
I really want bitcoin to succeed because it really is a great way to take back the power from corporations and the plutocracy we find ourselves in today. The fixed pool of bitcoins is slightly problematic.. would it not be better if the pool increased at 1% a year or so..? Gold made sense as a reserve since it formed a quorum among the various economies. The dollar makes sense now but so does bitcoin. The only issue I can't resolve is the deflationary impact of hodling since there will only by 21 million coins.
> a great way to take back the power from corporations and the plutocracy we find ourselves in today.
In practice this is ultimately just replacing one plutocracy with another. Though really, given that the only way to make "fuck-you" money betting on cryptocurrencies is to have an excess of disposable income in the first place, it may not be so much "replacing" as "reinforcing".
> The only issue I can't resolve is the deflationary impact of hodling since there will only by 21 million coins.
It's even worse than that, since people will continue to lose bitcoins. They've already lost 3 million or so: http://fortune.com/2017/11/25/lost-bitcoins/. It's as if the Federal Reserve promised to print $21 million in dollar bills, then never print any more. Maybe someday "bitcoin mining" will mean digging through landfills and scanning old hard drives for lost wallets.
[+] [-] jboggan|8 years ago|reply
“After you see this enough times, you just start to wonder what’s really going on here,” Mr. Krug said.'
I'd listen to the folks at Pantera, they are pretty sharp.
[+] [-] AznHisoka|8 years ago|reply
[+] [-] cdetrio|8 years ago|reply
> We vary N from 1 to 24 hours and examine the p-values. [.....] there are a number of periods where the p-values are significantly below 0.05 and we reject the null hypothesis for those periods.
Is it p-hacking to vary N and find low p-values? If its not p-hacking, but a valid analysis with predictive power, then wouldn't it make a good trading strategy to watch the tether wallet and buy btc whenever new issuance happens?
[+] [-] sudouser|8 years ago|reply
[+] [-] olivermarks|8 years ago|reply
Oh boy this sounds like the banking system I was hoping cryptocurrencies would supersede...
[+] [-] atomical|8 years ago|reply
> According to AQR Capital Management, about 1,000 people own 40% of the world's bitcoins.
I'm not sure having bitcoin oligarchs will work out great.
[+] [-] thisisit|8 years ago|reply
Not to question the Tether story but I don't understand this line of argument. What is the problem with exact increments?
Sure, the tokens have to be issued only if the issuing conditions are met. But given the number of hacks, wouldn't people want to use the issuing account sparingly? You know, use the issuing account to issue tokens in fixed increments to build up reserves. The move these reserves to be held in another account.
[+] [-] tim333|8 years ago|reply
[+] [-] brosirmandude|8 years ago|reply
Do people try to cash out immediately or do they flock to the "stable" coins like BTC or ETH?
To my knowledge the only thing you can trade tether for is other cryptocurrencies.
[+] [-] thisisit|8 years ago|reply
a. As per coinmarketcap, currently the largest BTC market is the BTC/USDT on OkEx. On looking closer, 3 out top 10 markets are USDT (excluding Bitfinex). So that is nearly 10% of only BTC liquidity gone.
b. As Tether and Bitfinex are connected so the exchange shuts down. It is the 2nd largest bitcoin exchange. So all that liquidity vanishes too. That brings our above total to 15%.
c. There will be many cross connected trades relying on USDT so my guess is the liquidity number will be higher, maybe even in 25-35% range.
d. This will cause panic and people selling BTC left and right. So BTC prices taking a huge hit. It might go down as low as 1-2k.
e. Most other cryptos are pegged to BTC. So with BTC liquidity gone they will take another huge hit too.
[+] [-] MekaiGS|8 years ago|reply
1) Cashing out to fiat, I don't know these exchanges well enough to determine if people actually managed to cash out their Tethers with real money in a meaningful sum.
2) Buying crytocurrencies available on these Tether based exchanges in order to get off these exchanges, which would actually cause prices to go up, but only in terms of USDT, not USD.
After that it really depends on what those folks would do next, they might choose to hold onto the coins or try to liquidate to fiat which would cause prices of coins on non-Tether exchanges to go down.
[+] [-] maxander|8 years ago|reply
Alternately, it might drag down other currencies by taking away the illusion of easy crypto-to-dollar exchange that tether offered, but other than that the dominant effect would likely just be investor panic.
So, no one knows how things will turn out! Such is finance. It makes for fun stories, at least.
[+] [-] ErikAugust|8 years ago|reply
I've always wondered though - how do you move multiple hundreds of thousands of dollars worth out to fiat in a single instance? Is that possible?
[+] [-] jchook|8 years ago|reply
[+] [-] neuro_imager|8 years ago|reply
If Tether doesn't have the funds then its a lot like someone borrowed 2Billion to buy crypto and can't pay it back.
Bitfinex will die, tether will die (just like other scam currencies like Bitconnect) but the market will come back after a correction.
[+] [-] mattcaldwell|8 years ago|reply
[+] [-] scott_s|8 years ago|reply
[+] [-] thisisit|8 years ago|reply
https://news.ycombinator.com/item?id=16279591
[+] [-] blhack|8 years ago|reply
Bitcoin gold -- a questionable bitcoin fork.
OmiseGo -- Soemthing I've actually never heard of, despite following cryptocurrencies pretty closely.
If OmiseGo, or Bitcoin Gold ended up being a scam, would the market even notice?
[+] [-] josephagoss|8 years ago|reply
That's huge. If this volume is based on fake dollars then I think the entire space could be massively inflated.
[+] [-] nlowell|8 years ago|reply
[+] [-] srdev|8 years ago|reply
[+] [-] monus21|8 years ago|reply
[+] [-] josephagoss|8 years ago|reply
I've heard many in the cryptocurrency space throw figures around such as $1,000.
I fear that the crash would be far lower. The argument is that the entire run up is fake therefore a realistic price would be back around $100.
[+] [-] ucaetano|8 years ago|reply
I recently created my own cryptocurrency, UCaetanoCoin (UCC), with a supply of 100 trillion and one coins, all owned by me.
I sold one to a friend of mine for $0.01 yesterday, which made me not only the richest person in the world, but also the first trillionaire, as the coins I own are valued in $1T USD.
And my UCC has a total market cap of $1T USD (and one cent). Then I exchanged a single coin with myself for $0.01.
As my coin has zero transaction cost and instant transactions (it's a badass coin), I traded it back and forth with myself 100 quadrillion times.
This generated a total traded value UCC-USD of 1 Quadrillion Dollars yesterday, more than any other security was ever exchanged in a single day.
Anyone wants to invest on my UCC? Here's my white paper:
https://cdn.shopify.com/s/files/1/0858/9696/products/122_102...
[+] [-] dang|8 years ago|reply
The comment itself is sort of a rehashing of by now ultra tedious material, too. You're far from the only one rehashing it—pun intended—but it would be good if everyone doing it would stop. Repetition is the leading anti-value of this site.
[+] [-] yeukhon|8 years ago|reply
The more active users are physically in the real world, the more trading happens. We will make our users live like a hamster running on a wheel. We give people incentive to live and make money! No more sitting in the office 9-10 anymore! They get social and outdoor life, and we make our money.
This will take off. Don’t waste your time on Facebook. Any crytocurrency marketer tells you to invest in facebook campaign is stealing your money. Listen - find some viral YouTubers and Instagram users to back you. We will make an awesome logo like the Grumpy Cat.
Contact me privately if you would like a quote for a complete proposal. I am happy to work out the details with you. We can refine the bots for sure.
Everything is done behind Tor - even more secure than ever! Our servers are located in Sweden so do not worry about!
Just so you know: I have patented the idea and design of this system. So don’t think about copying. Trust me. My name is yeukhon. I have a B.S in Computer Science. K?
[+] [-] jinfiesto|8 years ago|reply
[+] [-] atomical|8 years ago|reply
[+] [-] sudouser|8 years ago|reply
[+] [-] HN15718653|8 years ago|reply
[deleted]
[+] [-] sjg007|8 years ago|reply
[+] [-] kibwen|8 years ago|reply
In practice this is ultimately just replacing one plutocracy with another. Though really, given that the only way to make "fuck-you" money betting on cryptocurrencies is to have an excess of disposable income in the first place, it may not be so much "replacing" as "reinforcing".
[+] [-] atomical|8 years ago|reply
> According to AQR Capital Management, about 1,000 people own 40% of the world's bitcoins.
Take back the power? How? Power is still concentrated in the hands of a few.
[+] [-] username223|8 years ago|reply
It's even worse than that, since people will continue to lose bitcoins. They've already lost 3 million or so: http://fortune.com/2017/11/25/lost-bitcoins/. It's as if the Federal Reserve promised to print $21 million in dollar bills, then never print any more. Maybe someday "bitcoin mining" will mean digging through landfills and scanning old hard drives for lost wallets.
[+] [-] wmf|8 years ago|reply
[+] [-] atarian|8 years ago|reply
[+] [-] CamelCaseName|8 years ago|reply
If this weren't the case, HN may find itself completely buried by this topic, as well as the spammers that come with it.
[+] [-] jacquesm|8 years ago|reply
Never looked at the NYT as a satirical publication.
[+] [-] kapauldo|8 years ago|reply
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