The central allegation is that Tether would print coins for themselves that were not backed by USD and then buy BTC. Thus, artificially propping up BTC in a price range where they could then quickly sell, pocket profits, and stor the money to back the Tether they just printed.
In other words, gaming the system is pretty easy when you're printing/minting the money needed to do it. This is what puts crypto in a league of it's own.
Nope. The Fed does not print money for it's own personal/private use or to directly benefit it's members.
The Fed is incentived to profit from economic growth and increased financial activity --- which theorectically works to everyone's benefit. Individual Fed board members are restricted from personally investing in the financial markets to avoid the appearance of any conflict of interest.
> The Fed does not print money for it's own personal/private use or to directly benefit it's members.
You're referring to the small handful of people on its Board of Governors, but the member banks are private institutions run by private individuals who absolutely have investments.
Any policy changes the Fed makes affects all these private member institutions equally and at the same time.
They can guess but it's not possible for these private institutions to "know" what policy changes the Fed will make because even the Fed doesn't know until they meet and vote. It's not practical for one of these institutions to individually request or receive special treatment or favors from the Fed. There is no one individual at the Fed empowered to grant any such request. Making any such attempt would subject the institution to having it's banking charter revoked.
Compare this to crypto where exchanges can and do grant themselves special treatment and secret monetary favors without any permission or oversight whatsoever.