Quote from: o_e_l_e_o on October 12, 2023, 06:03:55 AM

Quote from: Z-tight on October 11, 2023, 05:51:02 PM

Do they even have to borrow money, they could just print their shit tokens out of this air and use it to buy assets to 'prove' that their reserves covers all liabilities.

Exactly. It's happened many times before. An exchanges goes bankrupt because of their own shady practices or because of a hack, so they either launch a shitcoin and "pay" back their users in this worthless shitcoin instead of bitcoin, or they just print a few hundred million of an existing shitcoin out of nothing to keep themselves solvent. A prime example of this is Bitfinex and Tether, where they printed almost a billion USDT out of nothing and gave it to themselves after they were hacked and insolvent.

This is indeed an eye-opener never to rely on these exchanges no matter how influential or renowned they claim to be. This issue is like mismanaging funds somebody put in your custody. And when he requests his funds, you tell him not to worry that you have another currency. And you go to your room and bring out some coloured papers and tell him that you will pay him with this. You still go ahead to convince him that in a few months, these coloured papers will be worth more than the dollars. Sadly many people still believe these lies and invest in these shitcoin.

Quote from: Hamza2424 on October 12, 2023, 11:58:15 AM

Still, people consider USDT trustworthy, it's all the game of valuation, there is a need for the realization that the value we need is not a stable currency it is Bitcoin. I'm afraid until we are gonna learn there will be another.

There is nothing stable about the USDT. How are we sure that Tether has the assets or reserve it claims it owns? Just like FTX the shady deals engaged by these centralised firms always come to light after it has collapsed.