Bitcoin is still early

[jacoavlu]

A Big Four audit would be nice, but Tether hasn't allowed any full audit (based on what I can find online):

"Need for audit
Such an auditor needs to do two things. First, they need to ensure that every Tether in circulation is backed by at least as many dollars. At present, there are just more than 2.2 bln Tether tokens in existence, meaning that the auditor must find at least $2.2 bln in the company’s bank accounts. Second, the auditor must confirm that the funds in those bank accounts aren’t actually designated for another purpose. It’s possible, for instance, for the company to have $2.2 bln in the bank, but have pledged some of those funds to secure a debt.

In order to assuage investors, Tether hired an external auditor, Friedman LLC. The auditor verified the first condition that there is, in fact, enough money in the company’s bank accounts to back all the tokens in circulation (as of September 2017). However, a complete audit is necessary to ensure condition number two, that other liabilities do not actually impair the funds in Tether's bank accounts.
Auditor fired
However, according to reports, Tether has terminated its relationship with Friedman LLC, claiming that the audit was going into too much detail and thus taking too long. Tether issued the following statement:

“Given the excruciatingly detailed procedures Friedman was undertaking for the relatively simple balance sheet of Tether, it became clear that an audit would be unattainable in a reasonable time frame.”"

Auditors are beset by conflicts of interest and the blessing of an auditor doesn't guarantee that assets are as stated. However, when companies don't allow audits, it is because they are fraudulent.

As I said, their CEO has stated recently that apparently an independent audit, for whatever that’s worth, should be forthcoming.

Additionally, there is the New York State lawsuit, where there was analysis of the underlying assets.

There is also the evidence that can be glean from recent redemptions of tether for dollars, to the tune of billions of dollars in recent weeks. There is probably not another financial institution in existence which could do the same, given the extensive fractional reserve nature of the banking system, where they hold a very small percentage of actual assets relative to liabilities

Regardless, time will tell. If you would like to join the tether bet, you are welcome.

[xraygoggles]

Maybe overlooked, but you didn’t answer the question

??? No idea what you are talking about.

BlockFi was like all these other "sophisticated institutions" - greedy, over-leveraged, under-collateralized degen gamblers. They are all the same.

I don't even trust Gemini anymore - I had mid-6 figs worth of stables on there that I removed. Better safe than sorry.

I would not be the least bit surprised if Coinbase implodes at some point. Voyager is the first big domino to fall, and it won't be the last. KuCoin may be next.

[jacoavlu]

??? No idea what you are talking about.

BlockFi was like all these other "sophisticated institutions" - greedy, over-leveraged, under-collateralized degen gamblers. They are all the same.

I don't even trust Gemini anymore - I had mid-6 figs worth of stables on there that I removed. Better safe than sorry.

I would not be the least bit surprised if Coinbase implodes at some point. Voyager is the first big domino to fall, and it won't be the last. KuCoin may be next.

I asked if you think blockfi customers are going to lose coins / funds. Hasn’t happened yet.

[xraygoggles]

I asked if you think blockfi customers are going to lose coins / funds. Hasn’t happened yet.

Oh I don't know about that, but why does that really matter? Company is defunct, reputation is dead.

[jacoavlu]

Oh I don't know about that, but why does that really matter? Company is defunct, reputation is dead.

you don’t think there’s a difference whether customers losing funds or not?

[jacoavlu]

BlockFi was like all these other "sophisticated institutions" - greedy, over-leveraged, under-collateralized degen gamblers. They are all the same.

I honestly don’t think they’re all the same. Celsius lost millions due to their exposure to defi in hacks, something like $100M in the BadgerDAO hack. Maybe wormhole too. They had millions in the terra/Luna anchor protocol. Millions in stEth that is locked up.

i haven’t seen any reports of blockfi doing the same types of things

blockfi had a collateralized loan to 3AC and they ended up losing like $80M bc even though they appropriately liquidated 3AC, the collateral was like 2/3 BTC and 1/3 GBTC. The GBTC collateral had of course declined in value bc of the discount to NAV that had widened, plus when blockfi tried to liquidate the GBTC, they were dumping the price bc the liquidity on GBTC is so thin. A mistake for sure but not the same as the defi stuff that Celsius and Mashinsky were doing

and of course blockfi has not paused withdrawals.

Celsius customers are going to lose funds big time likely as celsius probably ends up in bankruptcy. Customers will probably get some small percentage of their funds back as USD only, some years from now after lawyers all get paid

Voyager customers may end up the same. They are apparently a public traded company lol but they made an uncollateralized(!) loan to 3AC

3AC straight up committed criminal fraud. Those dudes are going to jail. Multimillion dollar houses and condos and a down payment on a yacht.

if I had to bet I don’t think those outcomes are coming for blockfi customers nor c suite execs

[Panscan]

As I said, their CEO has stated recently that apparently an independent audit, for whatever that’s worth, should be forthcoming.

Additionally, there is the New York State lawsuit, where there was analysis of the underlying assets.

There is also the evidence that can be glean from recent redemptions of tether for dollars, to the tune of billions of dollars in recent weeks. There is probably not another financial institution in existence which could do the same, given the extensive fractional reserve nature of the banking system, where they hold a very small percentage of actual assets relative to liabilities

Regardless, time will tell. If you would like to join the tether bet, you are welcome.

you think actual real financial institutions couldn’t handle producing like 15B cash in a month ? Is this serious sentiment ?

all of these fake defi bs companies are going to zero and it’s just a matter of time.

[CordMcNally]

Tether has been saying an audit is coming for over 2 years. There’s a reason that an audit hasn’t been done and it’s not because top firms won’t take it on. If you look at Tether’s statements and excuses over the years from a 50 foot view, it’s obvious what’s going on.

[jacoavlu]

you think actual real financial institutions couldn’t handle producing like 15B cash in a month ? Is this serious sentiment ?

all of these fake defi bs companies are going to zero and it’s just a matter of time.

“in a month” lol

you are welcome to join the bet also.

[jacoavlu]

Tether has been saying an audit is coming for over 2 years. There’s a reason that an audit hasn’t been done and it’s not because top firms won’t take it on. If you look at Tether’s statements and excuses over the years from a 50 foot view, it’s obvious what’s going on.

if you are so certain it’s fractional reserve, would you like to double the bet amount? I mean an implosion should be imminent now that they’ve redeemed billions of tethers 1:1 for dollars recently. There should be little left in the tank right?

[Tim]

Tether has been saying an audit is coming for over 2 years. There’s a reason that an audit hasn’t been done and it’s not because top firms won’t take it on. If you look at Tether’s statements and excuses over the years from a 50 foot view, it’s obvious what’s going on.

The problem here is a big four firm will actually take an engagement. The will want to be paid. The real issue is that the “opinion” is not in any way guaranteed.
The four types of auditor opinions are:

• Unqualified opinion-clean report.
• Qualified opinion-qualified report.
• Disclaimer of opinion-disclaimer report.
• Adverse opinion-adverse audit report.

The scope, limitations and disclosures required are the issue. Scope limitations will result in standstill.
No option for the company to “fire”.
The only option then is to find someone to take on a special engagement.
What is missing here is that this requires two years of audit procedures. Beginning balances, the years activity and ending balances to get an opinion. Over two years is understandable, but this path appears to be a dead end for a full opinion.

At a big 4 firm, there is a process for resolving different opinions, all the way up to the global managing partner.

[CordMcNally]

if you are so certain it’s fractional reserve, would you like to double the bet amount? I mean an implosion should be imminent now that they’ve redeemed billions of tethers 1:1 for dollars recently. There should be little left in the tank right?

I’ll do $200 to charity.

[jacoavlu]

The problem here is a big four firm will actually take an engagement. The will want to be paid. The real issue is that the “opinion” is not in any way guaranteed.
The four types of auditor opinions are:

• Unqualified opinion-clean report.
• Qualified opinion-qualified report.
• Disclaimer of opinion-disclaimer report.
• Adverse opinion-adverse audit report.

The scope, limitations and disclosures required are the issue. Scope limitations will result in standstill.
No option for the company to “fire”.
The only option then is to find someone to take on a special engagement.
What is missing here is that this requires two years of audit procedures. Beginning balances, the years activity and ending balances to get an opinion. Over two years is understandable, but this path appears to be a dead end for a full opinion.

how can you be so confident that a big 4 firm would take such an engagement. You think they’ll take on anything that will pay? Be real. Big risk. “Crypto” space ripe with fraud and generally looked down upon by powers that be. There are good actors but all get painted with same brush. Tether has controversial past and definitely have misbehaved. I see little to gain and much to lose for a firm to take that on.

[jacoavlu]

I’ll do $200 to charity.

0.00666 btc

by payoff time it’ll be like $40 lol

[Tim]

how can you be so confident that a big 4 firm would take such an engagement. You think they’ll take on anything that will pay? Be real. Big risk. “Crypto” space ripe with fraud and generally looked down upon by powers that be. There are good actors but all get painted with same brush. Tether has controversial past and definitely have misbehaved. I see little to gain and much to lose for a firm to take that on.

Taking on bankruptcies and all types of situations. If what you said is found in the audit and disclosed, they would receive an adverse opinion and the reasons why disclosed. Knight in shining armor has no risk. No company will pay for an “audited confession”.
That is why independence is important. It is not the firm, it is the company. Can’t get an acceptable engagement or opinion.
The reason being “management are crooks” would be problematic.