Tether has long since refused to release any concrete of proof of reserve and even when they were heavily pressured to only admitted to a lack thereof (74% in 2019 and that 74% isn't even fiat-only).
Tether is nothing but bad for the crypto-space as when it eventually DOES collapse a lot of people are going to find themselves holding something, USDT, which isn't as backed as they thought it was. Would you give me a dollar right now if I gave you back 74 cents?
The only sensible stable crypto asset is DAI from the MakerDAO which has been battle tested and proven under the worst possible scenarios (2017/2018 bullmarket crash) where it still held it's peg.
I don't know how this extends to USDC etc but for USDT I wouldn't touch it with a 20 foot pole.
If it was actually perceived as risky, wouldn't it be trading at a discount to USDC? However if you look, you can currently convert a billion dollars of tether into USDC with _positive_ slippage: https://1inch.exchange/#/USDT/USDC?network=1 For DAI, as of posting, you can covert 10 million.
So to answer your question, yes, I would be happy to take you tether for USDC or DAI
I'm no crypto expert or remotely experienced with finance, but my understanding of USDT is that it's simply a bridge to simplify moving funds between fiat and crypto. It even simplifies converting one crypto to another where there is no direct route on exchanges.
It's much less volatile compared to other coins and if it fluctuates a bit that's not really an issue in the short timeframe I do my conversions.
The problem was the NYAG who asked for proof and Bitfinex couldn't provide proof. So they paid a modest fine and got banned from operating in the state of NY.
74% backing sounds pretty good for a cryptocurrency. I wouldn't touch tether myself as USDC is better in every way, but I don't think there's going to be the fireworks that people predict if the peg falls only to 74 cents.
DAI is not scalable. See https://medium.com/@hasufly/maker-dai-stable-but-not-scalabl... for a detailed explanation as to why. Tldr: the supply of DAI is bounded by the demand for a particular kind of liquidity, which doesn't scale with demand for DAI.
> What is the backing of the US dollar at this point asides from threat of violence against challengers ?
That is part of the backing of any government issued currency and it's not a bad one. Usually currencies don't collapse or hyperinflate. If society breaks down locally the question is whether some crypto asset or the thing backed by guns will prevail in the mid term.
In war time: I'm betting on the people with the tanks.
This is the closest thing to correct, more specifically USD is backed by some real-estate and mostly TBill which is the government's ability to pay it's debt.
There's some sketchiness there, but generally it works, and of course, there are externalities like petrodollar but generally it's a sound currency.
It's not a super store of value, but it's not meant to be, there are other assets for that.
BTC is about as financially relevant as a GameStop mob, so if we're going to understand it, its' for the populist psychology, not for anything else.
In 2019 Tether was proven to be only 74% backed by fiat and fiat-equivalent assets: https://www.coindesk.com/tether-lawyer-confirms-stablecoin-7... This means it's not 74 literal cents per USDT but some proportion of a liquid asset and fiat.
Tether has long since refused to release any concrete of proof of reserve and even when they were heavily pressured to only admitted to a lack thereof (74% in 2019 and that 74% isn't even fiat-only).
Tether is nothing but bad for the crypto-space as when it eventually DOES collapse a lot of people are going to find themselves holding something, USDT, which isn't as backed as they thought it was. Would you give me a dollar right now if I gave you back 74 cents?
The only sensible stable crypto asset is DAI from the MakerDAO which has been battle tested and proven under the worst possible scenarios (2017/2018 bullmarket crash) where it still held it's peg.
I don't know how this extends to USDC etc but for USDT I wouldn't touch it with a 20 foot pole.