Are Crypto Investors About to Get Their Faces Ripped Off?


  • Contributor

    The U.S. Commodity Futures Trading Commission sent subpoenas on December 6th to Bitfinex (an exchange) and Tether, a company that issues USDT (a coin) and claims it’s pegged to the dollar.

    Tether’s coins have become a popular substitute for dollars on cryptocurrency exchanges worldwide, with about $2.3 billion of the tokens outstanding as of Tuesday. While Tether has said all of its coins are backed by U.S. dollars held in reserve, the company has yet to provide conclusive evidence of its holdings to the public or have its accounts audited. Skeptics have questioned whether the money is really there.

    “We routinely receive legal process from law enforcement agents and regulators conducting investigations,” Bitfinex and Tether said Tuesday in an emailed statement. “It is our policy not to comment on any such requests.”

    This might be the event that breaks the camel's back. Many investors have speculated that the coin market is in a bubble and is unsustainable. Last year a research group concluded that a single entity (Mt. Gox) may have pumped the price of BTC from $150 to $1000 using bots (dubbed Markus and Willy) using shady practices.

    Markus and Willy

    “In the end, we have concluded that Markus did not actually pay for the bitcoins he acquired; rather, his account was fraudulently credited with claimed bitcoins that almost certainly were not backed by real coins,” states the report. “Furthermore, because transactions were duplicated, no legitimate Mt. Gox customer received the fiat currency Markus supposedly paid to acquire the coins.”

    Aside from that, many have written about suspicious activity with "printing" Tether, a coin fixed by USD at 1:1 ratio. This is despite the company saying they have reserves to match the coins in existence.

    Bitcoin and other coins certainly have been resilient with many other mishaps and shady practices. We shall see how this chapter plays out with the regulators pursuing a probe.

    Source
    https://www.bloomberg.com/news/articles/2018-01-30/crypto-exchange-bitfinex-tether-said-to-get-subpoenaed-by-cftc
    http://www.tetherreport.com/
    http://weis2017.econinfosec.org/wp-content/uploads/sites/3/2017/05/WEIS_2017_paper_21.pdf


  • Contributor

    Funny how the latest crash is pinned on the Chinese, whereas the same Chinese did not harm so much the rise of bitcoin when the major world exchanges were closed.
    And btw, what happens with tether?
    HODL for life!!! Go Galt and sheeeeeiiiit!!!
    Hehe


  • Contributor

    @golem Not directly. But perhaps using margin lending and some other mechanisms. Probably trying to obfuscate any shady business.

    https://medium.com/@bitfinexed/are-fraudulent-tethers-being-used-for-margin-lending-on-bitfinex-5de9dd80f330



  • @dontgive So could people have been buying bitcoin with counterfeited tether, and that caused the parabolic upswing in valuation?


  • Contributor

    @db-down-under asked about his bankruptcy, a famous dude answered: how I became bankrupt was in 2 stages, first gradually and then all of a sudden.
    What you're seeing now is the gradual demise of tether. Watch out for the sudden one.


  • Contributor

    Tether is trading for a little over 96 cents :|

    It might be game over for a while until mtgox 2.0 blows over


  • Contributor

    @dingle zerohedge is a cnbc of sorts for urban foxes. They may have much lower numbers overall but the target audiences are really different and I think the Tylerz have a deeper penetration in their market (herded controlled opposition yuppies with wads of cash to flash) than cnbc with their shitload of broke trailer trash public.

    1 or 2 weeks before the peak I started hearing people speaking about BTC in my commuter train in the mornings, and I noticed zerohedge was mentioned quite a few times, more than any other source. That was odd, and this started shaping my perception of their influence on the market.
    So who's right and who's wrong? Maybe you're a bit right and me too.

    However what remains is that the Tylerz never ever spoke about the tether fraud before it was too late for the dumbest, and this is why I smelled a rat with their attitude because they knew something was happening in particular because of tmosley.

    Last but not least, they never questioned the numbers and the "official" explanations for the rallies, that were complete and utter nonsense most of the time. The actual real natural top for this market should have been around 3k and not 20k. Zerohedge did not seem to be surprised whereas all the fundamentals were continuously broken the day market rose again.

    So my final question would be: where's the old zerohedge who was skeptical of everything and questioned the numbers, did their own research and shared this information with a knowledgeable public? Where's the original zerohedge that broke the scoops to everyone, the real deal? -I'm afraid they left with the real Tyler...

    The zerohedge we know today is nothing but regurgitated hyped news for people who think they are on the edge. The most popular posters are either uninteresting pricks or people who are in the delenda carthago est category.



  • @shitshitshit I haven't given it much research or thought but my initial response would be: I think Zerohedge just does data mining and analytics, ergo they saw lots of clicks came from crypto articles so that's what they shat out. They were just surfing the wave and riding the gravy train. Plus, CNBC for examples has a much better traffic rating (and thus a greater influence on markets) which has gone up since april, whereas Zerohedge has gone even further down. IMO ZH really started taking a turn for the worse when Trump started campaigning.


  • Contributor

    THE bubble has indeed popped, or is about to. Now what never ceases to amaze me is how price action was linked to obviously totally unrelated events as well as alternate reality on zerohedge.

    Either Tyler is a moron or he's part of the tulip plantation.

    I can't think of any other explanation.

    Take for instance the massive rise that happened a few months ago. We could read that it was as per Tyler because of Zimbabwe or Venezuela or Ghana or whatever God forsaken country or hedge fund, whereas numbers did not add up and will never add up. Plus there is the all too convenient rampant tether fraud that goes under the radar even for TPTB, which lead me to think it has a role accepted by the authorities in the grand scheme of things. Indeed, how happier could they be to see peeple rejecting unregulated cryptos altogether after having been burnt so badly? This will be instrumental in herding them back to fiat or towards moar regulations.

    Now we are served with the consensual excuse that the futures market influences the price action, which I find extremely dubious at the very least because the volume of contracts is ridiculously low, and more importantly because this market has no way to leverage anything in the real world, except if they could purchase and dump back bitcoins on the exchanges. So no I'm sorry Tyler but the futures excuse is yet another excuse that is yet another smoke and mirrors to further transvestite reality.

    And the reality is the following: since last year zerohedge and others managed to create and grow a mass hysteria about the crypto market with the help of the brilliant and elaborate tether fraud. In so doing they claimed it was because of whatever stoopid shithole whereas it was not. And now that dumb money is all in zerohedge sold at ATH prices and left the crime scene while claiming the futures market is the reason for the pop. Absurd but anyway with moronic followers they will always strike a chord or two. Well done and see you next time for the next round until 100k or more, depending on how much you want to see McAfee reneging on his word (do you seriously think he would cut off his dick?).

    In conclusion: cryptos have been owned by big money since even before the average moron thought it was.

    What's more, Tyler could even play the plausible deniability trump card by "discovering" the tether fraud after the fact. That would be the icing on the cake, wouldn't it? This way he could hold the credible role of pointing fingers and playing innocent.

    Tyler never did and most likely will never do his due diligence in the field of tulip bulbs or acknowledged the tether fraud, let alone said a mea culpa to all the fleeced "investors" who mortgaged their houses following his advice. The reason is because the real Tyler left a while back and is now impersonated by an operation possibly up to no good besides manipulating idiots.

    Tyler, you must have made out like a bandit. Congrats. The buyback of zerohedge was indeed a brilliant investment vehicle, well planned and shit.

    For those who still read the lesson is the following: whenever an alternative blog is purchased you can expect this to be the start of a future fleecing of its followers.

    Do you think real investors work for free?


  • Contributor

    @dontgive said in Are Crypto Investors About to Get Their Faces Ripped Off?:

    @luck-dragon said in Are Crypto Investors About to Get Their Faces Ripped Off?:

    moving it into tether would have significantly lower fees.

    Until Tether eats a bag of dicks, and you lose your investment. I wouldn't touch it with a 10 foot pole.

    Hah, I'm not saying it's a good idea, I'm saying what the theory behind it was.


  • Contributor

    @luck-dragon said in Are Crypto Investors About to Get Their Faces Ripped Off?:

    moving it into tether would have significantly lower fees.

    Until Tether eats a bag of dicks, and you lose your investment. I wouldn't touch it with a 10 foot pole.


  • Contributor

    @woodman The idea is to move out of a crypto into something more stable, until you go back into a crypto. Since it costs to transact from crypto to USD with bank fees etc, moving it into tether would have significantly lower fees.


  • Contributor

    @dontgive Doesn't tying a coin to the USD remove it's value as a store of money? Tether is silly. I want something the gets more valuable, not depreciation by inflation.



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