Fifteen hours past the “big bang” – when Tether started plunging; cryptos surged – led by Bitcoin; and Bitfinex price premiums, for Bitcoin and many other cryptos, exploded to record highs; I figured I’d put down a few words at the commencement of the Asian morning session (which as always, started weakly).

We still have not had seen a Tether/Bitfinex “smoking gun,” though clearly the market is acting as if at least the former, and possibly both, are done for.  I have no idea how things will resolve – but given Bitfinex’s horrifying history, of bad business practices, hacks, and shady partners, I’d say the odds are uncomfortably high that it is in trouble.  

This is why I have avoided exchanges since the day Trezors were invented – and will continue to do so as long as I live.  Actually, as I reported last month, I did buy a VERY SMALL amount of Steem on Bittrex – but the second the Tether fears emerged last week, I sold it and sent my Bitcoin back to my Trezor…for good.

As I’ve stated exhaustively in the past week – through numerous articles and podcasts (posted on my website and Steemit page), and dozens of Tweets – I could care less if Tether survives, as Bitcoin doesn’t need it to exist…any more than it needs futures, ETFs, or “government approval.”  HODLing Bitcoin on a Trezor, I’m immune – and as the fiat currency system continues to destroy itself; whilst the Bitcoin network inexorably grows and Precious Metal demand wanes; the BTC price will rise irrespective, ESPECIALLY as we approach the May 2020 halving.  

With each passing day Bitcoin’s Hoffman Line holds (a $100 billion market cap), institutions and wealthy retail investors will join the crypto party.  To that end, we learned THIS WEEK ALONE that the Yale Endowment Fund is investing $400 million in a crypto hedge fund; Goldman Sachs’ former COO (and Trump’s top financial advisor), Gary Cohn, is joining a start-up blockchain company; and today, that Fidelity launched a crypto clearing and custodial service.

As for today’s price action, the premiums of Bitfinex over other exchanges has dramatically narrowed since the morning – at levels still well above last night’s pre-surge levels.  Yes, it’s early, but given universal expectations that a Tether collapse would destroy Bitcoin, I think that’s a quite impressive result.  Even altcoins remain sharply higher - despite the fact that unquestionably, a Tether plunge would damage their liquidity significantly.

In the big picture, the best case scenario for the sector is that Bitfinex and Tether are fine.  Sure, they’re still shady, but given new alternatives like the Gemini stable coin; Bakkt exchange; and possibly, Bitcoin ETFs; there will be safer – or better put, more regulated ways to invest in crypto, should one be fearful of Bitfinex or Tether (as they should).  As you can see, when the market assumed that this morning, Bitcoin didn’t decline at all – but instead, rose sharply…even on non-Bitfinex exchanges, which have no Tether-related solvency issues.

The worst case scenario would involve a smoking gun that causes one or both to collapse – which likely, would have a short-term depressive effect on the sector.  Or perhaps not, given what we saw this morning – as unquestionably, Bitcoin’s fundamental outlook would not weaken simply because some shady players were destroyed.  It wouldn’t be the first time, and it won’t be the last…and the more “competition” that destroys itself, the stronger Bitcoin will ultimately be.

I look forward to seeing how this all plays out – but holding Bitcoin in a Trezor, I have no fear whatsoever.