Government issued subpoenas to Tether and Bitfinex. UPDATE: THIS IS 2 MONTHS OLD NEWS
Tether Under Threat? Bloomberg Posts Old News and Crypto Market Takes a Dive. Bloomberg's rehashed story on U.S. CFTC sending subpoenas to Bitfinex and Tether caused the crypto market to lose $27 billion in an hour.
Following the story, Bitcoin dropped under $10,000 once again (on some price indexes) and Tether also went down to $0.975. However, the story was updated an hour later, adding that the subpoenas were sent last month, on
Financial regulators sent out the subpoenas last week to Tether and Bitfinex, which shares the same CEO. A subpoena is like a court hearing.
Tether is for those who don't know called USDT and is pegged to and supposedly backed by the US dollar. It was created to function a stablecoin, that allows you to avoid the volatility of cryptos while still owning a crypto. A little bit like the idea behind SBD.
When Mt.Gox first halted customers withdrawals in 2014, it took more than two weeks before they admitted that hackers had stolen more than 450$ million. This crippled the entire crypto ecosystem.
Only a week ago we had the coincheck-hack where hackers left with more than 500$ million. But this time 500$ was not enough to stop cryptos from holding above 550 billion USD total mcap.
Now, Bitfinex is showing similar shady behavior, witholding critical information to customers.
As early as march reddit-users reported that their wire transfers were cancelled. And after that there has been problems with getting fiat assets out of the exchange.
More troubling still is that Bitfinex has so far refused to provide an audit of the fiat funds that allegedly backstop the tether float, despite promising that it would be "fully transparent and audited to demonstrate 100% reserves at all times" when it first launched the token.
This has lead some to speculate that the exchange could be commingling tether funds with other customer assets.
This will probably have a snowball effect, where people will overreact to the FUD. It doesn't matter that much if ONE exchange goes down today as in 2014. So be prepared for a market that can fall as much as 50%, and get your coins out of Bitfinex if you have any there.
fud fud fud and more ffudd,, remember to buy when its fudding
Also... Facebook bans ads for cryptocurrencies
SEC halts $600 million ICO for AriseBank
Nice post. But i think if one exchange closes its going to affect the whole market especially if its bitfinex thats one of the biggest exchanges....
great post thank you for sharing
Another wasu wasu wasu Bitconnect.
Now wasu wasu wasu Bitfinex and Tether.
Bitconneeeeeeeeeeeeect!!!
Great analysis of the current situation with respect to precedents.
Ok turns out it might be old news from 2 months ago.
Actually almost a year old. But last week they have been called into court. And now rumors are that they are insolvent etc.. so this could escelate quickly, and its a heads up to everyone. Get your funds out of bitfinex if its even possible now. I doubt it. I see people complaining.
Never used bitfinex. But usdt is used extensively in many other exchanges, some which don't use fiat usd at all. The collapse of tether might bring the whole exchange market down. What is worse is that the legal investigations are likely to be slow, creating a longterm fud. But maybe this will be good for the sbd price later. At any rate, I just hodl.
Loved the analysis! Now I know where all the FUD is coming from, haha!
Anyway, if you wanna know why the price of Raiblocks is tanking so hard, feel free to check out my post as well! :)
https://steemit.com/bitgrail/@stevensteel/bitgrail-exchange-blocks-all-raiblocks-withdrawals-xrb-s-price-tanks-breaking-news
You know in the long term this news are irrelevant. Blockchain technology cannot be stopped.
Holding is the path to success. We just need to be patient and be active on steemit!
Bitfinex had shown shady behaviors previously prior to the incident now with Tether so they are not an exchange I really trust too much. Tether has always been a questionable cryptocurrency and indirectly I'm glad that the government is looking into what's going on. Hopefully Tether does have the funds in USD or else it will truly become a nightmare.
market panic could send us down to 150-200 billion mcap. Just be aware of the fact that that could happen. Many players are so f... stupid.
This is going to be ugly.
Read again...it's two months old news. I updated my post. Bloomberg updated their article just an hour ago or so.
The news is old but the market is reacting today, which is why I think it will get ugly.
But the market is reacting because bloomberg and other big medias reported on it like it happened today. Like it was breaking news.
Good point. It's very surreal how this is playing out.