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by repomies69 1203 days ago
If Silvergate had kept their reserves in Tether instead of those 10-year goverment bonds, they would still be chugging along nicely.
2 comments

Wouldn’t it be amazing if they had actually done that.

When the depositors all came asking for their money, Silvergate Bank would have replied: “So, we wired your 11 billion dollars to an unaudited corporation in the Bahamas. No worries, they gave us a cryptographic receipt for 11 billion virtual magic beans! I’m sure we can redeem those for you guys. Hold on, we’ll call their CEO, the man who used to produce Inspector Gadget cartoons in the 1980s… Oh, he doesn’t answer his phone? Telegram group message I guess…”

Actually this raises interesting question. Does Tether itself hold any 10-year bonds? And if there was a run on them, could they honor the peg?