USDT charges fees to buy Tether via fiat like USD (ie, same as Coinbase).
https://wallet.tether.to/transparency
More info on https://tether.to/wp-content/uploads/2016/06/TetherWhitePaper.pdf
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Iâm glad to see weâre getting value eventually back to USD, however the problem still seems to be that weâre dealing with a volatile conduit between the two âcurrenciesâ.
The peg technically isnât USD-NBT⌠its USD-BTC-NBT. In other words â I donât know anywhere that will take my USD and give me NBT. Or even take my USDT and give me NBT. That seems super weird to me. I get the problems of dealing with fiat, but pegging to something as volatile as BTC doesnât seem right â particularly when there are alternatives.
This seems even more strange when we know that BTC is a deflationary currency by definition, and the US Dollar is designed to be inflationary ever since the gold standard went away.
I feel that itâs a bit like saying âOK, you want to save some money in our bank. Cool. First go buy a bunch of shares in companies, and then you can trade those back for dollars and weâll put them in your account.â
If we must use some conduit to go from USD <-> NBT, might as well be the most stable thing we can find (in the analogy above thatâd be US Treasury bonds, in our example, USDT seems like an interesting option).
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This is because BTC is the de facto means of exchange at most crypto currency exchanges while most donât support USD because of KYC/AML at the same time.
That seems to be the prime reason why BTC/NBT was being used.
Better focus on getting NBT/USD going than using a direct competitor and earning them money, no?
I doubt this is a âmustâ.
It might just be more convenient to use BTC or USDT.
As dealing with USDT (e.g. withdrawing it) requires dealing with KYC/AML stuff, you can as well focus on NBT/USD and bypass USDT.
Not sure I agree. I donât think we can reasonably deal with fiat without all the of the things youâre mentioning here (KYC, AML, bank accounts, etcâŚ). If thatâs the direction weâre going to go, Iâd be even more worried.
My worry about going between USD <-> NBT is really about switching between something that is known to have the same value and less about âcashing outâ of the crypto-currency ecosystem.
If I want to get out of the system, I recognize that there will be some hurdles, specifically focused on money laundering and friends. What I really want is the ability to say âI want off of the BTC roller coasterâ.
NBT has been letting people do that, and paying pretty dearly for it. USDT has been recently letting people do that, but without the same losses.
The big differences IMO are:
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USDT is likely to be compromised all at once (âSomeone robbed our bankâ) whereas NBT value will erode slowly (as it hasâŚ)
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USDT suffers from the same throughput and confirmation time problems as BTC whereas NBT has itâs own chain with much faster confirmation times and higher overall throughput.
Going back to the comment⌠Is anyone interested in doing a NBT <-> USD peg? Can we get Poloniex to start one? Iâd consider putting up some NBT and USDT to kick it offâŚ
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My understanding of why Nu gave up on supporting USD/NBT is due to the fact that the only exchange that listed said trading pair received $XX (double digit) in exchange-wide trade volume per day. This lead people to give up on the idea of fiat liquidity almost completely. I have thought about using Tether as a tier of emergency reserve liquidity recently, but I donât think our customers would desire another step between NBT and a bank account as part of standard procedure.
We certainly should not have PPC anywhere in our reserve liquidity. I think that is another serious issue with Nu, that it has no problem passing risk of the PPC market onto our customers, because many shareholders came from the PPC community.
Why bother with NuTether, then? Is the question I leave myself asking. The only useful purpose for Tether in Nu would be an emergency tier of liquidity. I almost wrote up a proposal for NuPit. It is a website similar to Shapeshift where you send your NBT to an address and receive $0.95 worth of Tether. The NBT would get burned, and for running NuPit I would be granted a predetermined number of NSR as laid out in the motion, based on how many NBT were burnt or how much Tether was spent. It would only be a one way valve in times of peg stress.
At the end of my thinking on the topic, I decided I would need to ask for too much NSR to make it worth my while. And with the hyperinflation of NSR already underway, it is unpredictable how much NSR I should ask for. And is the NSR really that desirable anymore?
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NBT pegged to USDT would be valuable (to me at least) because I can use the Nu chain to execute transactions â and itâs pretty zippy.
When Iâm standing next to someone and want to pay, I really donât want to have to find a bench and make small-talk while I wait for a single confirmation.
BTC is great for distant transactions (ie, when Iâm buying something that then has to be shipped to me⌠minutes donât matter), but it kind of sucks when youâre standing next to the recipient.
There is a/has always been a fear of centralization with Tether. That is why I joined Nu. What do you do when that fear comes to realization and Tetherâs bank accounts are robbed?
I just do not think tx confirmation time is innovative enough to start a new DAC.
The nbt/btc liquidity operation takes volume away from nbt/usd merket.
You could rephrase this to say, âShareholders put more liquidity in the nbt/btc market instead of the nbt/usd marketâ Couldnât you?
Many donât realize these two market compete with each other. Although itâs true that there is little speculation space in the nbt/usd market so there is not as much activity.
I remember in 2014, after @desrever temperorily designed the NBT/BTC pair before NBT trade on exchanges, Jordan made the decision to accept NBT/BTC pair, and I was astonished, this means Nu company becomes a BTC reverse speculation company.
Now Tether is trading on various crypto/Tether pairs, this is the beginning of their bankcrupt if no enough revenue.
Take a look at Tether. They do not, and have never, provided BTC market liquidity. But the result of that has brought them to a level of volume in the BTC market that we couldnât achieve even when subsidizing it with large and expensive walls on a tight spread.
They donât even have to pay anybody for liquidity!
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Adding additional crypto markets doesnât harm tetherâs bottom line since they only support the fiat/tether peg. The rest of the markets just fall into line.
Their bankruptcy will come when governments raid the Tether bank accounts or they confiscate funds from a âbad actorâ.
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they are smart by avoiding btc pair, but they still have expenditure: employees, rent house etc.
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They supposedly prove their USD reserves. Reserves are always higher than outstanding. What is their overhead? I imagine it is practically nothing.
Some bot has consistently provided very good liquidity on the Poloniex BTC/USDT at less than a 1% spread. I donât know who is running the bot, but most likely Tether is offering the liquidity.
It appears Tether followed our lead in regard to providing liquidity on BTC pairs, and for good reason.
You could run a 1% bot on polo and make a small profit thanks to tether being listed on BitFinex. They did not follow our lead, as you say. And like we canât prove you are Jordan Lee, you cannot prove Tether did what you allege.
If you buy something at $1 and sell it at 1$, you have no profit, so whatâs the point of your business? In real world, how many businessmen dare to do business without proper revenue model?
Or Tether has a long term plan: they just provide free service to cultivate customers habit, and after many years they will harvest.