De-Risk Cream From A Tether USDT Collapse

Things are not looking good for Tether. It’s not so much a matter of if as it is a matter of when Tether will collapse.

And because we dont really know what a tether collapse would look like, it’s hard to predict how this will play out in the market.

Compound finance has acknowledged this vulnerability to the ecosystem by completely disallowing USDT to be used as collateral to loan other assets.

Compound’s USDT audit also references that tether has the ability to implement a fee on transfer.

I think the cream community and governance holders should strongly consider disallowing tether to be used as collateral. The defi ecosystem needs to derisk it’s self from tether .

A few references covering the current status of tether : - Bennet has been reporting on the tether situation for quite sometime and should be considered a SME on this topic.

CoffeeZilla recently did a video on this subject, (as a new user i can only include 2 links, search youtube for coffeezilla tether if interested)

I hope the listing committee is looking into this.

1 Like

Following up here. How can we bring more attention to this issue?

Celebrating 10 years of “Tether is insolvent” FUD :tada::tada:

You don’t actually provide any evidence of insolvency, mind doing that?

Also lol at how Compound “fixes” this issue , they basically assume usdt will never be insolvent and always = $1 (source: audit report you linked)

This is only to borrow USDT against other assets.

They do not allow USDT for collateral .

No one knows what tether is backed with , unknown commercial paper.