$3.5B stolen was "stable coins", which you could equate to a piece of paper with a dollar amount written on it.
Those are largely freezable by the issuer of the paper.
Then we have $2.4B in Bitcoin and ETH stolen. Those are not directly freezable.
However, if that does create a liquidity challenge for these exchanges, what if the price just so happens to drop by 60% after trading is restricted? That liability might shrink in actual value.
Comparing crypto to actual currency typically connected to large, real economies is not relevant here.
A country like Iceland is far smaller, and their currency famously fluctuated in 2008. Would you consider Icelandic króna as money? Most people do.
Anyway, that and your question are hardly relevant to the fact that Binance and their cabal own the crypto exchanges and consequently could manipulate the price to reduce the size of their obligation denominated in crypto rather than currency or stable coins.
I understand Binance alone accounts for a third of the market, and their ability to coordinate with other exchanges is hardly restricted to the participants we know were in that specific group chat.
I think the point stands that a liability in eg. USD is much different from one denominated in crypto.
Yeah Binance itself is big but it'll take a lot more than one exchange, an exchange everyone is now handling with extra suspicion, to cause a crash.
> I think the point stands that a liability in eg. USD is much different from one denominated in crypto.
If course it's different but that's so much weaker of a point. And the foreign currency comparisons weren't to particularly stable currencies.
Binance obviously has influence on crypto prices, potentially affecting a liability denominated in crypto.
And I'm sure they have nonzero influence but anything significant needs more evidence than a signal call that has Kraken in it.
> "Those are largely freezable by the issuer of the paper."
Interested to understand how this would work in a decentralised accounting mechanism.
Crypto at it's current price has a market cap around $2.6T. Obviously the liquidity is questionable, and since crypto isn't connected to any mention worthy real economic activity, a change in sentiment can quickly crash the price and liquidate leveraged positions.
While that's of course true for other assets also, crypto not being connected to production of real value, combined with the comparative lack of regulation, makes it much easier to manipulate.
In my view their interest, which aligns with that of all other major owners of crypto, is to acquire as much real currency as possible.
Acquiring more crypto by decreasing its valuation is not furthering that.
Maintaining a high valuation and positive sentiment in order to convert buyer's real currency into profit to cash out is what I believe their strategy is.
Presumably the hypothetical price change is reversible or there would be no point. So lower price, buy, raise price, sell, repeat. A dump-n-pump.