Worries Grow That the Price of Bitcoin Is Being Propped Up

[InfoGuy]

Worries Grow That the Price of Bitcoin Is Being Propped Up

A growing number of virtual currency investors are worried that the prices of Bitcoin and other digital tokens have been artificially propped up by a widely used exchange called Bitfinex, which has a checkered history of hacks and opaque business practices.

Bitfinex had contracted with an American firm, Friedman, to audit its records and prove that its operation of Tether is above board. But last week, Bitfinex said it was cutting ties with Friedman, after waiting months for it to finish the audit. That news generated more suspicion.

?It?s a signal to the market of what those who have scrutinized the situation already believe: There is a problem here,? said Jill Carlson, a former trader at Goldman Sachs who now consults with a variety of virtual currency companies. ?The dissolution of a relationship between an auditor and a company is very rarely a good sign that the company is behaving in accordance with market best practices.?

Tether offered a preliminary report last year from Friedman, the accounting firm, suggesting that it had bank accounts with dollars corresponding to all the Tether that had been issued. But the report was far from conclusive and Tether has never produced a real audit, leading to suspicions that Bitfinex may be printing virtual money backed by nothing.

The Tether currency has been valuable to traders because it allows them to hold a stable token, tied to the value of the dollar, and move it quickly between virtual currency exchanges.

But there is a downside. Because the identity of Tether holders is not always clear, the movement of the virtual token between exchanges ? and across national borders ? has raised concerns among lawyers about money laundering. The spread of Tether beyond Bitfinex has also spread the risk of its failure to other exchanges.

[pimpmaster9000]

the bigger problem for BTC is that etherum is falling less and less during BTC dips...it may well lead to:


THE SWITCHENING!!!!


this would be really bad news for everybody who holds BTC....

[rogueteens]

Originally Posted by crucifissio

the bigger problem for BTC is that etherum is falling less and less during BTC dips...it may well lead to:

I spotted that too.

[chaze]

Yeah think lol. It worked though.

[pimpmaster9000]

Originally Posted by rogueteens

I spotted that too.

I spoke too soon LOL they bailed out too...

digixDAO is holding, it is backed by physical gold (or so they say)...it will be interesting if there is something to peg the worth to other than tether...

[OneHungLo]

But they said you could buy bitcoin with your IRA ...lol

[InfoGuy]

How long will it be until one of these are posted at Bitfinex?

[Snagglepuss]

May or may not be soon but one thing for sure. Cyber currency has just tooooooo many ways it can go bad for none of them to come true. If you got in early cheers to you, get the fuck out and count your winnings. If you got in late, your just plain fucked.

[DBS.US]