Hey guys, I've been researching a bit about the Tether situation and the whole thing doesn't worry me, it's the community that worries me. People are irrational and will probably succumb to FUD and panic sell like the crypto-community always does...
So below, are three possible outcomes of the Tether situation, one for if Tether IS backed by USD and two for if Tether is not.
Backed by USD
All good. FUD cleared, people can get on with their trading and restores a lot more confidence back in the market.
I hear so much uncertainty about the situation so some people are selling and new-comers don't want to start investing due to "idk wot USDT is but it sounds bad". When this clears, many new investors should have the confidence to buy in and many long timers should have the confidence to buy the dip ;)
Not backed by USD (good outcome)
Panic sellers sell, cause a dip.
Whales buy the dip.
People realise that USDT doesn't really matter, it shouldn't affect the worth and value of other coins and projects.
Markets gains confidence as FUD is over and people realise it's not as bad as they thought.
Not backed by USD (BAD outcome)
Panic sellers sell, cause a dip.
This triggers more panic sellers causing a crash.
Whales use this opportunity to set up sell walls and push the price even lower.
The volatility and crash will cause many new investors from ever investing, and more and more old timers will finally, stop hodling and just retire from crypto.
May take several years for confidence to build up in the market again which will probably cause a delay in the advancement of blockchain technology, but I still see blockmain as the future.
Discussion
- Which outcome do you think will happen?
- Do you think my analysis is reasonable? If not what are some of your arguments?
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I personally think BAD outcome would be most likely. Because most of people in cryptocurrency market is rookie (including me); and they probably dont know how to react to a situation like that.
For example, I'm not an investor (but if it were) I think it would go into panic, just thinking that my investment would generate a loss, instead of a profit.
So I would try to sell as quickly as possible...
(IN FACT, IF THE MARKET IS SO UNSTABLE, AND WEAK, I BELIEVE THAT I WOULDNT THINK OF INVESTING )
But on the other hand, despite the chaos, I think that many (the most experienced) would take the risk. I dont think it's possible for the market to collapse in such a way, to be extinguished, or to cause everyone to retire from crypto.
Greetings from VENEZUELA!
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Technically you're an investor cus you're on steemit!!
But that's true, many are expecting the worst so they're selling, including the experienced.
I feel like some people are just sick of the volatility, my friend just told me he's so tired of seeing his portfolio drop, the gains AREN'T WORTH IT. He said when he makes a bit more he'll liquidate his portfolio (which is worth like $500 dollars).
GREETINGS FROM AUSTRALIA, wait no i'm in beijing right now ;)
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I mean investors who invest "real" money in those businesses!! :D:D
Maybe your friend already had enough ... but I think that an important part also of the crypto, is patience. Hopefully things will "stabilize" soon.
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I just want this Tether ordeal to end. In a good or a bad way, it doesnt matter as long as we move on from it. The sooner the better.
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i feel you man, i just want all the FUD and anti-FUD (???) to end, so I can day trade in peace haha
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Can there be another Tether?
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I was thinking that too! Unfortunately, it's not that simple as a new USDT.
But more and more exchanges like COSS are moving towards fiat (real USD) trading pairs!
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The idea of a Tether worries me in the first place. There's also the EURT on the Ethereum blockchain. These seem to me like the crypto-equivalent of a Federal Reserve Bank. I understand the value of a stable coin, but I think decentralization is the higher priority.
Why aren't Tether and Bitfinex located in the US, anyway?
I'd rather see stability arrived at by new complexity emerging from evolving blockchains. A tether coin based on the performance of many high market cap cryptos would demonstrate stability in the way index funds do...
I think we ultimately want to be divorced from fiat entirely, yes?
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4th option - Tether not backed by USD. BTC price falls as people realize that when TETHER prints money they "buy" BTC, which artificially inflates the price. The ponzi continues to work as long as BTC holds it's value.
When BTC doesn't hold its value the ponzi explodes, USDT goes to 0; BTC bubble bursts. Bubble bursts causes panic sells, whales dont buy the panic until it's pennies on the dollar. Some cryptos like ETH survive this because they are amazing projects on their own however 99% do not survive and go to pennies.
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jesus, that's bleak.
good thing I bought ETH yesterday during the dip for under 900 each ;)
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Ha, My mind can go into some very dark places ;) The way I look at tether is that if it was legit, they would have a huge incentive to come clean. They've now fired the auditor which means they have a lot to hide. Honesty is the best policy. ETH has doubled it's pair vs BTC over the past month and I think it will continue to do that.
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nice
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