Tether is a stablecoin, supposed to be worth USD1, backed 100% by assets. Its use is that it’s easy via blockchain technology to buy and sell bitcoins and other floating coins from or into tether … then back to old fashioioned and slow motion bank wires to sell the Tether for USDs.

But Tether as I write is down to 0.97.

So Mrpunter sells his bitcoin for 28k … no … 27k … sorry 26k now … tethers … then finds he’s not actually going to get USD 26k …

I wonder if tether isn’t a bit of a problem … maybe the collateral has been partly vaporised? Like, Buffett has oodles (100bn) of cash from getting insurance premiums in before paying out any liabilities. Float. He keeps much in tbills but uses some of it for buying risk assets.

Suppose the very smart guys and gals running Tether’s collateral decided to get rich by buying ARKK with some of the float? Now it’s not backed 100% and so becomes a ponzi … all fine until there’s net selling … when to quote Buffett again … we find out who’s been swimming naked …