[astoor]

So Tether has become something like an international reserve cryptocurrency, which gives them an "exorbitant privilege"[0], meaning they can do pretty much whatever they want safe in the knowledge that everyone else will do everything they can to prevent them from failing because everyone else would have too much to lose if they did fail. That has kept it going for a long time, and might (or might not) keep it going for a lot longer, but ultimately a replacement reserve cryptocurrency will come.

[0] https://en.wikipedia.org/wiki/Exorbitant_privilege

[puranjay]

By most measures, it appears that Tether is slowly going to die out and replaced by USDC. Among retail users, Tether has increasingly lost sway and is largely used only on exchanges (which is still massive, but not the only game in town anymore).

Roughly half of USDT is circulating on Tron, which is a dead chain. This TRC20 Tether is almost exclusively used for inter-exchange transfers (since fee is capped at $1/transaction)

On Ethereum, USDC is now bigger than Tether. Over a month, Tether on-chain supply has dropped nearly 12% [0]

[0] https://defillama.com/peggedassets/stablecoins

[lkrubner]

The "exorbitant privilege" usually belongs to a government with a vast military, and/or substantial colonial possessions -- something that allows force to be used in an emergency. There is a reason why the US dollar, but not the Swiss franc, is an international reserve currency.

[nradov]

The UK Pound is still considered an international reserve currency by virtue of being incorporated into IMF special drawing rights, even though the UK no longer really has a vast military or substantial colonial possessions.

[JumpCrisscross]

> the UK no longer really has a vast military

Beyond the nukes another comment mentioned, the UK is also a permanent UN Security Council member, a founding NATO member and a productive member of the Five Eyes and AUKUS [1]. And it still has the world's fifth most powerful navy [2].

> substantial colonial possessions

No, but they have overseas military installations in Gibraltar and on Cyprus, the Falkland Islands and Diego Garcia. Smaller installations at Ascension Island, in Singapore and Brunei "provide important staging posts and logistical support facilities for British and allied forces passing nearby" [3]. In terms of practical force projection radius, they're in a very small club of nations.

[1] https://en.wikipedia.org/wiki/British_Armed_Forces#cite_note...

[2] https://worldpopulationreview.com/country-rankings/largest-n...

[3] https://www.europarl.europa.eu/meetdocs/2004_2009/documents/...

[jeffdn]

They still have the ability to put nuclear warheads anywhere on the globe, by virtue of their ballistic missile submarines and the nuclear warheads those ballistic missiles carry. The Trident D5 missiles have a range of more than 7,500 miles, and the submarines move.

That, in and of itself, is worth a lot -- potentially even more than having a large military.

[ClumsyPilot]

'They still have the ability to put nuclear warheads anywhere on the globe'

I think most of UK public would consider that a prime minister that plans using nukes in offensive capacity belong in a padded cell.

[jeffdn]

I completely agree, I was just responding to the parent commenter's assertion that the UK didn't have the offensive power to have "exorbitant privilege"

[dr_dshiv]

I saw a trident missile launch once in 2017. Didn’t know it at the time. Everyone should know about those missiles—they are the reason we don’t have “real” war.

They are so unbelievably powerful it blows my mind.

[davidgay]

> ... even though the UK no longer really has a vast military

https://worldpopulationreview.com/country-rankings/military-...

At #5 world-wide by expenditure this may be a bit over-stated. Or else "vast military" is just a standin for "US or China".

[nradov]

Expenditures don't mean much. Look at purchasing power parity, and actual capabilities. The UK military lost the ability to conduct large-scale independent operations without US support decades ago. Capabilities are minimal in many crucial areas including logistics, aerial refueling, strategic bombing, amphibious lift, ballistic missile defense, and space dominance. Even their nuclear deterrent is completely dependent on the US military-industrial complex.

[giaour]

You could save some time and keystrokes by just typing out "too big to fail."