[LatteLazy]

The reason banks are regulated is the risk of contagion and the risk of short term drops in markets making them illiquid or shallow so banks can't meet their commitments.

But tether has no risk of contagion to a bank does it?

And markets have never been more stable or deep or liquid.

So the case for regulation here is weak.

Again. I don't actually know if tether is a giant fraud, or how much actual business case there is here for stable coins. I'm just saying, it's sort of easy to make a case at least that they're fine.

[Jensson]

Banks are regulated to protect your money from the bank stealing them. Before those regulations keeping your money in a bank was riskier than keeping it at home. That same situation now plays out with crypto, the crypto bankers create banks with high risk investments that nets them huge profits, but that will easily fold to market fluctuations. But them folding doesn't matter to them, they still keep all the profits generated before them, while you the guy who put your money in the crypto is the big loser.