To me this is huge threat to all cryptocurrency trading. If a government takes control over Tether they could wipe out all trader profits with the push of a button. So a trader thinks they are smart by keeping their profits in stable coins. When Bitcoin goes down 25% in one day, the trader thinks: ha I am not affected. But what he does not know is that one day, his entire profit might get frozen and he has traded all that time for absolutely nothing. While if the Bitcoin price goes down even 90% at least you still have all those Bitcoins if you keep them in your own wallet. Even if you keep your Tether in your own wallet. The way Tether is set up as OMNI token it can be frozen BY tether. Which means it can be frozen by anybody that takes control of tether. This is the big risk of centralised systems build on top of Bitcoin. You think they are safe because they are build on top of Bitcoin but it really depends on how they are structured. Other stablecoins might be setup in a way where they cannot be controlled by the initial issuer. And finally the only real stable coin is DAI which is being kept stable by math rather then trust.
So as a trader you could have the biggest stories about Bitcoin and how Bitcoin is government by the laws of mathematics and not human trust. If then you are still parking your trading profit in to Tether on a daily basis. (which the market shows most traders do as Tether sometimes does 4 times it entire market cap in volume in one day. Which means every trader on average would make 4 crypto to tether and back trades per day)
Well then you not living by the same rules you are preaching.
Mark my words. One day Tether will burn so many traders who preach the decentralised gospel but don't live by it themselves.submitted by /u/Kain_niaK
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