I'm curious if the collapse of Tether would lead to another crash like FTX did, or if it so expected by the community that it is essentially already priced in.
Who is holding Tether? Why would they take the risk on what is supposed to be a "stablecoin"?
I think I have like $15 of USDT on an exchange that's getting ready to kick Americans off. It's nice to hold when you don't want to deal with volatility. That's assuming you trust it won't go to zero. Also there are stable coin pools. I have some money in a pool of 2 different stable coins and I get paid out in the exchange token.
I've never understood the logic of a stable coin in general, why not just hold cash.
However, I'm suggesting that with the potential dramas around Tether, as any peg is equal to any other, why not hold a stablecoin that does not have Tether's bad reputation?
Kinda funny how many people -- especially "curious" HN users -- will gladly write a comment wondering why anyone would use stablecoins rather than regular dollars, despite the ease of googling the answer or searching HN, and despite the litany of over-clever users asking the exact same question over the past three years.[A]
1) Stablecoins can interface with smartcontracts and the crypto blockchains, regular dollars can't.
2) More smartcontracts use Tether as their stablecoin than others.
... for the 1000th time.
It's almost like y'all don't want an answer, but just to sound clever and "above all of this".
Because you can't transmit cash to crypto exchanges? Also, Tether is the oldest and most rock solid stablecoin. Maybe supported by criminals but they've never failed to redeem
I think you mean you can't transmit cash between crypto exchanges. You can definitely transfer them into exchanges. Or perhaps you meant you can't store in a hardware wallet.
I personally don't believe any of these things make the case for holding a stable coin.
Remember the coin is pegged to a real thing, so it can't outperform, but it is at risk of total collapse. The only way for the "cash" you hold to collapse is for the entire banking system to collapse. In which case, you're still better off holding BTC.
Who is holding Tether? Why would they take the risk on what is supposed to be a "stablecoin"?