A dollar is a dollar. A crypto dollar is a ?

  1. In the last week, the good folks at IBM have proclaimed progress with a USD backed coin.
  2. An announcement from the Bank of England about its recent trials in interfacing the new world of Blockchain to its payments system.
  1. The exchange where he held his BTC and cash; were they operating on a sound basis?
  2. Tether as a company. Did they really operate on a sound basis? There are good reasons to doubt this; firstly, they recently parted company with their auditor, so there is now no way to check that the $2.5B they claim to have are indeed backed 1:1 with greenbacks. On top of that, a recent article suggested Tether is vulnerable to a double spend problem. That article is over my head in terms of tech comprehension, but taken with the first, that verifying the 1:1 backing is not readily possible, the BS detectors go to overdrive.
  3. The bank where Tether holds the underlying USD. $2.5B greatly exceeds any deposit insurance. If the bank holding the USD goes under, even if Tether is 1:1 backed at that moment, the Tether coins are worthless. And, even if there are several banks, there are not 10’000 banks.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store
Olaf Ransome

Olaf Ransome

12 Followers

The Bankers’ Plumber. I help banks and FinTechs master their processing; optimising control, capacity and cost. I also offer training courses; Operational Risk