News: Problems with Tether (USDT) Surface / Initial Exchange Offerings (IEO)

Yo, yo, what's up everyone and welcome back to Box Mining. It's been almost half a week since we last got updated with what's happening on the cryptocurrency news. And to be frank, there wasn't much happening for most of this week. But today, today is different because we got Tether coming out to say, you know what? Yeah, we're not 100% real US dollar back. We got some reserves and some IOUs here. So we're going to take a look at what that means and what it means with Tether USDT in the long run. We're also going to take a look at these crazy exchange, initial exchange offerings. It's really happening, guys. It's like every single exchange seems to be announcing that they're going to launch an initial exchange offering platform, pretty much just like Binance Launchpad. And honestly, I got to say these violent delights will have violent ends. And we're going to take a look at what's happening over there. So we're going to talk about all these news updates today. Also, I got a special interview at the end. This is with Captain Crypto. He's one of the kind of really cool YouTubers in the space making a lot of content. Also, he's been attending a lot of conferences. And I met up with him in Hong Kong. He's attending Token 2049. And he's going to give us a little bit of an update with what's happening with the offline conference scene as well. So all this and more on today's box mining. Remember to click that little like button if you guys like this video. And it really helps this channel grow. A quick glance at the market. It's not really much happening recently. So Bitcoin is pretty much at the same point at which we left it last week, 3,900. We've got a few odd coins going up and down, but nothing really substantial to report. One thing that I have been looking at recently is what's happening with the offline scene. Because when it comes to offline, a lot of people there are whales, a lot of funds, lots of very wealthy individuals. And it's when they start to, the people who don't care about the space, when they start to completely exit, capitulate. And the people who are actually in the space, they get bullish. That's when things really turn around. And that's what I'm kind of looking for when I'm going to conferences. But more of that on the end of this video. Let's go to the key news of the day, which is Tether. So Tether has always been stating and telling us that it's 100% backed by US dollars. Now they just upgraded their language a little bit. So that 100% backed is not necessarily backed by fiat. So let's look at the language here. Every Tether is always 100% backed by our reserves, which include traditional currency and cash equivalents. And from time to time may include other assets and receivables from loans made by Tether to third parties, which may include affiliate entities. Bitfinex. Every Tether is one to one peg to the dollar. So let's try to reaffirm that. But this language change is really key because that means that they're issuing out loans. It could be potentially issuing out loans to Bitfinex. One of the exchanges are very closely associated to. We kind of assume that Tether is backed by one US dollar and then a lot of people actively store it and use it as a way to reduce risk of cryptocurrency price fluctuations. Exactly. That's kind of where the term I just tethered myself came from. But the problem here is that USDT, if it's not one to one backed, what happens when people try to claim and they run out of fiat? So this has been an ongoing kind of debate in the space. You know, how much should we trust Tether? Is Tether legit? You know, they're essentially printing out their own money, right? Is this really as good as this? I mean, when it comes to crypto, I've been kind of assuming the worst out of everything that can happen in this space. Never trust anyone. And we've just seen exchanges close down left, right and center, whether it be a Quadrica CX or recently Gatecoin in Hong Kong. I'll talk about that in a sec. And also MT Gox personally being a victim of that. So when it comes to Tether for me personally, I just if I need to, I do hold occasionally. Sometimes I use it as a tool for trading on crypto exchanges. But I usually try to cash that out as either fiat or going back into crypto. Leaving as Tether for a long time, I think it's always been a problem. And one of the reoccurring problems with Tether is also Tether FUD. We've seen that in April of 2017, where Tether prices just dipped to 90 cents. Yet again, the same thing happened in 2018 in November, October levels, where yet again, there was a lot of FUD. There's a lot of fear that Tether is just going to close down a shop and you can't redeem everything. So I just don't want to have that kind of like emotional stress of keeping a bunch of Tether around. I'm suddenly finding out, you know, the next day, oh, my God, do I buy or sell? Personally, right now, it's actually a great time to look into how to deal with Tether. It's not below a dollar. There's no FUD spreading. So you can actually have like a very clear mind of what to do. I made this post just for fun as well. Tether policy update in 2020. Every Tether is always 100% backed by reserves, which include traditional currency from time to time. Various ICOs, casino chips, Chuck E. Cheese tokens, and whatever else we can find in our pockets. Talking about exchanges as well, one of the local exchanges in Hong Kong, Gatecoin, they closed down. It's kind of funny because one of the first conferences I've ever been to in crypto was actually sponsored by Gatecoin. And they're talking about how cool they are that they are regulated in the financial system. And ironically, that regulation meant that there was a lot of hurdles and they couldn't really compete in this space. And now they had to shut down and get liquidated. So that kind of sucks. And that kind of tells us that banking, dealing with banks in this space is not easy at all. So rest in peace, Gatecoin. All right. Last thing about IEOs, initial exchange offerings. So we're seeing this everywhere. It started off with Binance Launchpad. Launchpad launched the BTT token fetch and now it's going for seller. But now all the exchanges like Bittrex, OKEx, Huobi, they're all saying, oh my God, they're missing out if they don't do initial exchange offerings. Because obviously the exchange gets a huge cut here and they benefit a huge amount from either investing early or potentially having free tokens or even just benefiting from the trade. So what we see is that Bittrex is just jumping suit. They're just saying, oh, look, we're launching something for a raid. It's going to start in 10 hours. And OKEx had the audacity of writing this article about why initial exchange offerings are better. So let me just read one part here. The question here is, is initial exchange offering old wine in a new bottle? Apparently, OKEx thinks not. They say to conduct an IEO, the team must meet and comply with the exchange's requirements in order to launch a token sale. Contributors are therefore protected by the exchange. Since when did we get protected by the exchange? I mean, nothing personal against OKEx. I'm just personally, I've been very distrustful of exchanges after MTGOX. I know that exchanges don't have our best interests at heart. They have a lot to benefit from listing as many tokens on or launching as many IEOs as possible. Because honestly, they can make a lot of money. They can get those listing fees. They can take tokens up front. And we don't really know what's happening in exchange black box either. There's a lot of room for a million things that they can do. My take on this right now is that initial exchange offerings are really just really accelerated ICOs. And with more hype, less due diligence. Well, what can go wrong, right? I'm definitely going to make a more detailed episode on IEOs. Just looking at how they're engineered. How the token structures are laid out. And kind of just general some thoughts about that as well. So make sure you subscribe to this channel if you haven't done so already. So you won't miss out on what really is happening with the IEO scene. Next up, I made a segment with Nathan. We're here with Captain Crypto or also known as Nathan. You've been doing crypto videos for quite some time now. And I just kind of wanted to get to know you a little bit. You're all the way here in Hong Kong. Welcome to Hong Kong. I've been touring around for quite a bit. Just checking out offline world. How do you find it right now? Like this offline space, this conference space. What do you think about it? I think there's still projects that are still coming out that are still being shilled. So is it too much shilling right now? Do you think it's still too toxic right now in the conference space? Yeah, because somebody has to pay for the conferences. So there's still... I don't want to... I might get in trouble, but fuck it. So there's still people that have to put in money to sponsor all these conferences. So they still put in money. They still have title sponsors. And they still have projects that are shilling. But at the same time, I went to Bitcoin Miami. In January. And it was 10 times less people. So from 5,000 to 500 people. So there's only 500 people there. At Denver, not very many people. It was a good event though. So there's still good events out there. It's just you have to find the right ones. And since there's more conferences than there are days of the year, now I just... I'm very choosy about which ones I go to. Right. Yeah. Yeah. Yeah. Yeah. And what's your motivation to go to these conferences? You know? What do you... What's your objective? Do you want to learn something? Do you want to see meet particular people? What is your... What's your... So two things. I guess for selfish reasons, I want to learn more. You know, from other people. And then I also feel like just like... Giving the community a voice is very important. Like kind of like I've watched your videos and stuff like that. You're very unbiased. You know? And it's like... The community doesn't have a voice. Most people, they just chill. They talk about a certain project and how it's going to go to the moon, when moon. And people don't really care if you're not talking about money. But the community is still alive. And at the end of the day, if anyone's going to carry you or like bring you forward, it's going to be the people that believe in you. So I think mainly just like being unbiased. And so we'll go out to conferences, Phil will shoot, and then he'll just come up with a question. And if someone shows their project, we just kind of like cut them out of it. So you're just like, okay, we'll record it anyways. But, you know, whatever, right? Just cut it out. Make it a faster pace later on. Yeah, yeah. Or like sometimes the audio messes up or... The audio messes. You know, the focus. Or something happens. Yeah, if they show their project, we just kind of make them feel like they shield their project. So we just kind of cut them out of the video. Yeah. So how do you find Hong Kong? So you just went to Token 2049. Vitalik was there. We got a bunch of other people there. I guess Vitalik was a title spot. Like title, you know, idol to go there. What do you think of his talk? What do you think of the atmosphere? So I'll be very, very, very honest. I feel like... So I met Justin Sun. Interesting character. He's a nice guy. Very busy. I would say that he... He knows his stuff. But he's just like... He just doesn't have time. You know, we literally got there. We had an appointment at 1. We didn't even know what we were going to ask. Went in there, turned on the camera, asked him and he had to leave. You know? And so... Yeah, so he doesn't really talk much. He had an interview with Forbes. And then I feel like since they had that Twitter beef, I think like he maybe... He just invited Vitalik to go over there. And so Vitalik gets on stage. Everyone's there. He starts talking. He's like, does anyone have any questions? Nobody raises their hand. You know? So nobody has any questions for Vitalik. And then Vitalik's just like, all right, I'm out. And he just dips. Peace. Yeah. Peace. It's gone. Yeah. That's an interesting spin on it. So I guess... I guess we're still at a stage where people don't understand or care about the tech that much. They care about the hype. So do you think that's kind of characteristic of what you're seeing? Yeah. Hype and just like holding on. So I've been blessed to meet a lot of like old school people that have been in it for a minute. You've been in what? Since 2012, right? So you've seen them. Yeah, kind of. In and out. I kind of regret not going into it deeper in 2012. But, you know, started mining back then. But they didn't know a lot of people. They didn't know the community back then. So it's kind of like isolated, kind of off in a corner doing my own mining. Anything for a while. So how many like how many bear markets or bubbles have you been through? I think this is my second full one. So I guess the story behind this is that like I wasn't actively trading or actively doing anything crypto in the first bear market. So when it went up and it went down, I didn't really notice it. I kind of like... What was the price at for that time? All right. So I got in in 2012. So it was $10. And I told my dad, like, dude, I'm like, you know, mining some Bitcoin. He's like, whatever. I don't care. And then two years afterwards, he called me. He was like, dude, like Bitcoin, man. It's $1,000. Oh, not like not not like dude. But he was like Bitcoin. So $1,000. You got any more? I'm like, no. It's like it's all it's all gone. So that was my first bull run. And then at that time, I watched Bitcoin fall from $1,000 to $300. And I didn't really feel it that much because, like I said, I didn't have that much at stake. And then the second, this is kind of the full, very full bear cycle. I got in at the kind of the bullish state. And then now I'm, you know, living the bear state. But I think one of the biggest things I learned from crypto before was that like this stuff doesn't die. It's always cycles. It's just have to deal with that emotion. There's a lot of emotional kind of feel to it. And it's good that like one good thing is like I'm going to these conferences. I'm seeing less people. And that's actually good. The people who are not understanding what the space is about, they're leaving. And also potential dumpers. They're just going to dump it all. And they're just going to be out. And well, bear market is going to come. Sorry, bull market is going to come when those guys are all gone. Right, right. So like the people that are in the space that are supposed to be in the space are in the space. You know, like, like, so I can say that like David Waxman, I'm sure you know him. He started, he, his dip was what, 250. So he bought Bitcoin 250, you know, still over 3,000 right now. And then Daniel Castanoli, he founded Exodus. Oh, yeah. I love that guy. His first dip was $1,000 dropping down to whatever he said, 300. And he told it, I don't know if I can say this, but like, he's a, he's a dear friend. And he went all in. He's told his girlfriend, they're, they're, you know, I don't want to go too much about that personal life. But like, he said, this is it. So he put his entire life savings into it. And then it went up to 20,000. And then Eric Voorhees, he's, his biggest dip was $31 to $2. So he was like, that's a 96% dip. That was his, so this is his fourth bear market. So I mean, like. Yeah. I mean, these are, these are the legit people that, that are around, right? And I think it's a, it's refreshing to talk to people like that, that understand the cycle, understand the mentality. And all these guys, I think one kind of overall combining aspect of them is that they, they know that there's not easy money when they go all in. It's not like they're expecting moon the next day. I think it was just like, you know what? It's going to be eventually there. Right, right, right. And then, so it's kind of like, what are they going to do right now? They're going to try to just build, you know, they just, they fund projects that they're going to do. And then I've talked to a lot of funds, a lot of funds have taken a lot of hits. You know, there's a lot of capitals out there. I know FPG Capital says that they only took a loss of 8%. I don't, I don't know the numbers. I don't want to accuse anyone of anything, but it's just like a lot of crypto funds are dying. A lot of media companies are dying. Crypto in itself is, is dying, but it's still there. It's just that it's going back to normal where it should be. Going back to build, going back to business. So I don't know. We'll see. We'll see how about that, that goes. Hopefully, you know, we can introduce you more regularly on this channel. You know, we've seen each other for just like the third time now that we've seen each other. Yeah, we've shot videos together. Yeah. So hopefully, you know, we can come more often and share some opinions of someone who has been through this, you know, like, and you've seen a lot in the offline space as well. So that's one of the things I want to bridge together. You know, the fact that offline is like, it feels like a different world, but at the same time, you know, it's, it's the one, it's one part of the ecosystem. So hopefully we'll get more. So we'll try to see each other in LA. Yeah. You're coming down next month, right? Yeah. I'm coming down next month. So we'll hopefully shoot some good stuff together and be fun stuff, man. Yeah. So if you guys have any topics that you want us to cover or if you want us to go anywhere or do anything, we might collab with Potato Jet. You can look him up. He lives with our old, he lives with one of my other friends that used to direct for Kryptonauts. So we might do a collab there. Any topics, anything you want us to do. I'm not going to light my hair on fire like Potato Jet, but like we will take, I guess, they can comment or they can ask you and we'll shoot it in LA. So yeah. Awesome. I'll see you there and hope you guys can join us on this little tiny adventure. Yeah. Thanks for your time, man. Cheers, man. Cheers. Cheers. And that's it with the session with Nathan. I'm really excited and looking forward to doing more stuff with Nathan in the future. I'm going to head to LA soon. So what I'm going to do is next week, actually, I'm going to go to San Francisco, check out GDC, Game Developers Conference. And then I'm going to head over, just go around the US, try to meet as many people as possible. So shout outs to Mitch Ray and shout outs to Omar. Anyone who is near LA and stuff will try to meet up and do something crazy and fun. So really looking forward to that. Guys, thank you guys so much for watching this video. I would love to hear what you think as well about this initial exchange offering. Do you agree with me or disagree with me? Leave a comment down in the comment section below. And as always, if this video helped in any way, remember to click that little like button down below. And of course, subscribe to this channel so you don't miss out on all these news updates and all the cool stuff that's happening. Thank you guys so much for watching. See you next time.