Tether starting to lose its peg too, after Terra did
The thing that I think some people miss about Tether is that it&#x27;s not about whether it is backed <i>enough</i> it&#x27;s either fully backed or it isn&#x27;t. If it&#x27;s not, it&#x27;s not a question of whether it&#x27;s back enough to weather this storm, it&#x27;s about whether the people running it <i>think</i> they can weather this storm. If they think they can keep it running they&#x27;ll sell whatever backing they have and keep the peg. But if they even think there&#x27;s a decent chance they can&#x27;t permanently sustain the peg then the best thing for them to do is take the backing and run, not sink it into a stable-coin they now know isn&#x27;t going to work. That&#x27;s going to happen <i>way</i> before they run out of money.<p>Let&#x27;s say for example, Tether is 20% backed and there&#x27;s $100Bn  of coins so the backing is $20Bn, and people start flooding out of it. Let&#x27;s say $10Bn floods out. So the guys running it have handed out $10Bn. They now have $10Bn left, and money is still flooding out. Do they really continue to hand over the cash or do they say &quot;Well, the whole thing is about to explode anyway, I&#x27;d rather keep the $10Bn cash I&#x27;ve got left&quot;. At which point the holders of the coin have to play &quot;Find these fuckers and sue them&quot; which will be difficult since they&#x27;ve got $10Bn to fight&#x2F;flee&#x2F;hide.