Binance, Bitfinex and Tether: What's the Worst That Can Happen?

Investment guru Charlie Munger, for example, says: "Invert, always invert: Turn a situation or problem upside down. Look at it backward. What happens if all our plans go wrong? Where don't we want to go, and how do you get there?".

There is potential for catastrophic, systemic risk in crypto right now.

Recent events surrounding Binance, Bitfinex and the stablecoin Tether necessitate this conversation.

The New York Attorney General continues to demand more information from Bitfinex and Tether.

If such action prevents USDT from being freely traded, holders of tether would then almost certainly sustain significant losses.

If the government finds conclusive evidence of fraud committed by Tether or Bitfinex, then it stands to reason that decisive action would be taken as a result.

The fallout from such a scenario would likely envelop the whole crypto space.

Do you think crypto investments will be safe then? What exactly will happen to them if everyone is trying to head for the exits?

Much of which applies directly to crypto and digital asset investing.

If there is a systemic shock to the crypto space, it is likely that many investments will suffer.