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by vkou 1498 days ago
> If they can do that then there is a bunch of money to be made.

Hoping to make money by betting on Tether collapsing is like taking out insurance against the event of a combined global thermonuclear war & genocidal alien invasion of the Earth.

If you win the bet, you won't have anyone to collect from.
2 comments
tomjakubowski 1498 days ago
You could make money off Tether's collapse if you shorted it the simple way (and managed to time it very well) - borrow units of Tether from someone, sell them at $1 (ka-ching) later purchase the same quantity Tether at $0.00001 and return them to your lender for a tidy profit.

I suppose if Tether collapsed to the extent that it was impossible to trade it at all, you'd have a hard time buying the worthless Tether back. What happens if you're short a stock traded only on the NYSE and the stock exchange itself disbands? Or maybe the better analogue is, how do you fulfill your end of the deal as a short seller and return the shares owed to your counterparty if the company disbands in the meantime?

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Sylveste 1498 days ago
>Or maybe the better analogue is, how do you fulfill your end of the deal as a short seller and return the shares owed to your counterparty if the company disbands in the meantime?

If you're short a company and the company goes properly bankrupt then the shares are literally worthless paper, you just throw them away.

I've been in this situation with interactive brokers and the position just disappears. (You get the profit as though you closed the position at a price of zero.) Shares of something that doesn't exist similarly don't exist. They just vanish.

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Sylveste 1498 days ago
>If you win the bet, you won't have anyone to collect from.

They have $78B of assets, not $78T. It wouldn't rival even the smallest of national defaults. Heavy rhetoric but a bit OTT don't you think?

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vkou 1498 days ago
That money isn't in a jurisdiction you may necessarily be able to reach.

They also have no obligation to pay anyone a cent of their reserves. Any USDT->USD exchanges they do/claim to do are a courtesy, not a requirement.

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