Deng Jianpeng: What are the dangers of stablecoins?

According to a report by Cointelegraph, a well-known US blockchain, on the 20th, after the US Financial Stability Oversight Board issued a stable report in November 2021, US Treasury Secretary Nelly Liang has recently published a report. Commenting on the "potentially dangerous" of BTC, he said, "If Congress doesn't pass legislation, the administration will try to use its power." Regulators argue that investors' use of stablecoins could harm the economy and, if successful, a measure of market losses could affect the financial system. So critics like Mark Cuban see 2021 as the year of stable financial governance.

Stablecoins will become a "key step" in the crypto world, especially in 2021, attracting US Treasuries (SEC and Treasury) and the Office of the Securities and Exchange Commission. . What are the risks of stability coins? What are the implications for the business? This sentence tries to identify it further.

Introduction

Blockchain finance is a new application of data sharing and cryptographic technology in the financial industry, and the emergence of stablecoins is an important achievement of paid blockchain finance. The Financial Services Commission (FSB) defines securities as “cryptographic assets that hold a fixed price, including assets, pools, or baskets of assets.” According to different types of anchors, stable bonds can be divided into fiat-backed stability coins, crypto-asset-backed stability coins, and algorithmic stability coins. Among them, Tether USD (later USDT) is a USD-secured fiat-backed stability coin and occupies the largest market value among stability coins.

Unlike other products can be encrypted, renew the major issues will be treasure. In addition to the United States, European countries and districts, the rules and leaders of many countries they do. The usdt has a great danger and its great application will reflect the traditional financial system, do not realize the rules of investors and profits, money Maker terms and financial stability. If the USDT is round business in Chinese market, it can be replaced with the digital RMB states and can be directly related to the digital RMB practice of China. According to the announcement 2019 Encrypted business, China marketers have more than 60% of the USDT, and the business is less than 4.5%. Since September 2017, China rules blocking Renmini is simple and transaction has become most common investors. Some of the actual management of the approved benefits that receive USDT's business has come or have a variety of changes, and large transactions . USDT.

Regarding the impact and functionality of USDT, the International Organization for Security (IOSCO) has pointed out that the stable value of USDT is a cryptographic legacy designed to use fiat as an anchor to reduce the exchange rate in the crypto industry. USDT has been widely used as a means of payment, property or deposit and has become an integral part of the distribution ecosystem. This article describes the implications and procedures of USDT and provides a discussion of the risks of USDT, providing key insights from China on the legal and regulatory aspects of the product. has a stable value.

ob,USDTMeaning and mechanism of operation

Ebt birth from 2014 and permanent, US dollrar Togget Anchor, US dollar Anchor Anchor. Contact a different market and make a stable price similar to the funds. USDT the machine works are: the user is the first time as the bank account of US Dollars in American dollar. The rope is opened by the user account and the number of USDT, the number of USDT, number, and user has. USDT POINT - point point. By interviews called the market platform for market or market, business, mortgage, financial management and etc. After the tourism, the user's use of the actor is being plether exchanging, and the tider will destroy the ometric revenue and join the financial account. Each of theDDT is now getting supported by the string. USDT provides advertisements without enthusiasm, and girls are the cost of users. USDT's work process has an important job in the middle, and competition management of the USDT, and adjust the Reference of the Rate of 1: 1. According to the Hill's partner, the city of city macro law is the most powerful in the USDT agreement. String is the big-scale Iciaonus and all the stable coins with a large cuponomous, beaten up and review and see .

The work process ofDoNt, the meaning of the mortgage loan is combined. By seeing the business industry ,ebt set the general phone. The reason why "currency" can be called can be a grate, which is a model, and stable. Others are an acknowledgment across. In "Call" Changes, USDT itself is an important part of the main structure and the value of private control of the digital representation. Because ofDodt has the shopping world, reunt believed that USDT can change freedom (or believe that it is equipped with the wide Business Marketing Benefits With One Half-Trade Monitoring "Cash" Incrypted Business Required Width of wide or foreign office of bank hosting.

In 2020, the re-announcement of USDT will be faster than last year, leading to an increase in the value of USDT. In June 2021, the market value of USDT exceeded $60 billion, ranking third in cryptocurrency market value after Bitcoin and Ethereum, accounting for around 60% of a portion of all backed stability coins. to fiats. USDT has a very strong commodity, the daily exchange rate is usually around 200%-500%, and the daily trade is around $50-100 billion. Today, USDT has become the most important entry point for Chinese traders entering the cryptocurrency market.

Three,Risk of centralization of the current process

From the perspective of the USDT process, defenders are important and controlling, and the USDT process is in a "black box" state. Susceptible to fraud, credit and corruption. There is a risk of money laundering. At the same time, it is difficult for middle Tether makers to maintain 1:1 exchange rate security in the global market. The drop in prices that will cause prices to fluctuate for the trader. On the other hand, USDT smart contract strength management is private advisor driven, and advisor confidence is low relative to earnings from good or stable results. When confidence burst, the USDT bubble quickly burst. Additionally, Tether storage facilities in the middle may face the risk of trade withdrawal or deposit by regulators, and the global flow of USDT into the storage model. Storage in the middle will pass the decision of supervised banks and will require major regulations and regulation. . dangerous.

four,the announcerInternal management and risk compliance

Tether has a high degree of overlap with the management team of popular cryptocurrency exchange Bitfinex. In 2014, Bitfinex CEO Porter and CFO Devasini signed Tether with CEO Vandervelde as CEO. Tether and Bitfinex actually work for the same group, and there are unrelated issues that pose a hidden risk to the management of the company and subsequent prosecution by US police. At the same time, Tether's financials and finances are not transparent and there is no regulatory compliance or tracking of progress. Tether has only reported one temporary audit report in the six years since the company was founded, and since its partnership with Frisburg and Sullivan ended in 2018, Tether has not hired a single one. person in third exam. The black box of finance and analytics caused a stir in the market.

Tether refusal is also considered an “overlord clause”. According to the terms of the user, Tether is exempt from liability for fiat currency in any event (such as bankruptcy and loss of business activity). Convert or destroy USDT. Moreover, after Tether took over fiat currency exchange services in 2018, it deliberately restricted the number of users' trades and increased trades. The disclaimer mentioned above results in restrictions on redemption and investors' right to know and increases risk.

five,fraudRisk and credit risk

USDT's political features are insufficient and resources not easy to believe the employee confidence. In 2019, the New York tests V. in the case of the tie, tied all the victims of the victims about 26% from USDT's Girdt. At the same time, as a test report from the mool (Moort cayiming cash means that the tetet did not meet 100% of the most valuable Home (Deltec) and string of financial information of Bahamas, and the bank of the Bahamas will show up from $ 4.714 $ 350 million (cbob, 2020), $ 113.4 quarter of the rope in the third neck of the rope we have shown to 4 or more. Three $ 10.7 billion insetent . This does not follow eachDDt request from the string of string and a lot of false, Super string of string and The transaction is little promised by the bitfinex exchange, son Configure fraud. Preparing to prepare and incomplete asset is equipped with the major culse and the risks of theDDT.

vegetable,Increase the risk of cryptocurrency trading

USDT is put into wholesale and Tether sells USDT to consumers through the wholesale market for cryptocurrency exchanges, forex wholesalers and OTC traders. The exchange is the top beneficiary of USDT. USDT has been pouring into the famous exchange through the new announcement of Tether since March 2020, accounting for over 86% of the total USDT circulated at the same time. These exchanges signed a USDT agreement with Tether and opened the exchange of USDT and various cryptocurrencies. The exchange must include risk assessments and warnings. If Tether is found to have reported USDT fraud, the advertiser and advertiser are jointly responsible or liable, even if the exchange knew about it. At the same time, if the exchange "must" or fail to monitor the registration of USDT or provide mixed trading services violates the law, the exchange and its management and management are actually involved in fraud, the financial fraud or computer crime network criminals. These will be activities including legal risks and significant management liabilities.

Sept,Money laundering and money laundering is dangerous

With anonymity, low prices, and easy volatility amid tight federal regulation of cross-border investments, USDT is more popular in international capital and gray and black markets. In October 2020, the US Department of Justice released examples of USDT being used in drug trafficking, financial transactions, and corrupting officials. . This shows that the USDT has had the tools to support crime in recent years, mainly used for money laundering, drugs and other crimes and misdemeanors, or to promote the crime of running out of RMB currency, causing a lot of stress. control the body. Because USDT has been widely used as a tool for counterfeiting, governments around the world may apply stricter rules to it or restrict trading at certain times and places.

Yum,Impact on exchange management and financial security

Compared to stable currency regulation (USDC, GUSD, etc.), USDT expansion has a greater impact on countries regulating foreign exchange and financial security. USDT pegs assets in US dollars. According to the definition of exchange in the "Rules of the People's Republic of China on Foreign Exchange Rule", USDT is similar to the exchange certificate, code or means of payment. This is equivalent to exchanging foreign currencies impersonating a foreign agency or someone with USDT. Users pay RMB to buy USDT at home, then subtract foreign currency from the currency, or pay foreign currency to get USDT abroad and sell USDT in RMB from door-to-door sales, which exceeds the annual limit of $50,000 in foreign currency in private. In recent years, the purchase and solution of the existing foreign management system in our country. At the same time, due to USDT trading and fiat gains, active and large-scale USDT trading in stocks has increased risk in financial markets and may change on a measurable scale. , increase the risk. Speculation in the financial sector. Additionally, the popularity of USDT could alter the role of the digital yuan and affect the spread of fundamentals, threatening the security of our macro-monetary system.

In summary, compared to compliant fiat-backed stability coins registered and operated in the US, regulated by the US government, legally owned, regularly held by third parties, and advertised to the public, USDT is not strictly monitored . Confidentiality also increases the risk of trading with multiple USDT users. The risks of USDT are undeniable and cannot be ignored.