RE: Bitfinex, Tether and the crytocurrency markets
for starters, what authority does the US Commodity Futures Trading Commission have over Tether and Bitfinex?
very little.
There seems to be enough smoke around tether to suggest something is amiss - but it is a completely seperate currency to bitcoin - and whilst it's crash might create a bit of initial FUD and bring the prices down somewhat, it doesn't change any of the fundamentals behind bitcoin, or any other cryptocurrency for that matter.
I would argue against it creating liquidity in bitcoin, because if USDT wasn't around people would find another safe haven, whether that be fiat, or one of the other 1400 cryptocurrencies.
in the end of the day USD is a currency that has depreciated against bitcoin for 9 years, so it's hardly a safe haven, even if many interpret it to be so.
I agree, but trading is all about market perception and trader psychology if they get scared they will run, initiating a panic sell. I think main media got the recept and is working perfectly for them. Looks like an elections campaign to me.
I think Tether is a way around for exchanges to handle USD without actually having to carry with the legal obligations that come with it. I agree with you, this SHOULD NOT affect bitcoin and the rest of crypto but it does. Too many people invest in crypto not as a new (better) way of holding value but just as quick way to make some of what they perceive as "real" money, so the fear of not having a quick way out (as Tether is supposed to be) makes crypto way less attractive to them. Markets are more about psychology than they are about real facts