Quote from: /arbab/ on October 16, 2018, 05:37:44 AM

Quote from: DooMAD on October 15, 2018, 07:48:29 PM

Quote from: Blackforce on October 15, 2018, 07:11:21 PM

But with Tether every 1 USDT is actually 1 real dollar of value invested (obviously this is debatable, but that's the premise of tether). So you have $2.4 BILLION of REAL value against maybe $10 billion of real value with other coins (if we exclude BTC). So if Tether collapses and goes to zero, Binance suddenly doesn't have the money that it "technically" owes its users, because Tether is never supposed to be under $1, it's not treated as a traditional coin where if it goes down it's your fault.

Unless by "Binance" you mean "Bitfinex", then no. Binance are not guaranteeing the value of Tether, so they will not owe their users anything. I'm pretty sure there was something in the fine print that said even Tether themselves aren't guaranteeing the peg. If you lose all your money in Tether, it is your fault. Don't treat it differently to any other coin, because I don't see any greater likelihood of someone bailing you out than with any other coin.

Having checked Tether's Legal page, even living in "certain US states" (although they neglect to mention which ones) is already enough to invalidate any claim you might think you have.

//EDIT: and further down the page:

Quote from: https://tether.to/legal/

Force Majeure: Tether is not responsible for damages caused by delay or failure to perform undertakings under these Terms of Service when the delay or failure is due to fires; strikes; floods; power outages or failures; acts of God or the states enemies; lawful acts of public authorities; any and all market movements, shifts, or volatility; computer, server, or Internet malfunctions; security breaches or cyberattacks; criminal acts; delays or defaults caused by common carriers; acts or omissions of third parties; or, any other delays, defaults, failures or interruptions that cannot reasonably be foreseen or provided against. In the event of Force Majeure, Tether is excused from any and all performance obligations and these Terms of Service shall be fully and conclusively at an end.

So yeah, in plain English, if it goes to zero, don't expect any handouts.

Not true. Maybe Tether doesn't owes any money to their users but Binance definitely does. That's the whole concept of the stablecoin. Maybe not for other coins as mentioned but for Tether it does. Tether doesn't owes you to redeem it for money but it owes you to make the guaranteed peg of $1 at all times. https://tether.to/legal/. But, hypothetically if we consider, Binance doesn't owes anyone anything. Do you think the judiciary will accept the plea against billions of dollars of lawsuits? Definitely not.

Binance owes customers who hold USDT exactly the amount they hold individually. Let's say you hold 5000 USDT and the value drops to 50 cent you will still be able to withdraw your 5000 USDT - but it would be devalued of course. Same if it would go to zero.

Binance would only be in trouble if the exchange itself should hold huge USDT-amounts. But the real shitshow will start with Bitfinex and in my opinion it already has started. Bitfinex and Tether are lead by the same guys and if Tether dies Bitfinex will most likely not survive - and the other way around. Since both companies are totally intransparent and working with a lot of shell-companies (very likely), having trouble to find banks who don't shut their accounts down after a few weeks because of anti-money-laundering-rules, the situation is already on the edge.

Best would be if both, Bitfinex and Tether, become slowly irrelevant. If they should go down in flames it would have a very bad impact on the whole space.