4th option - Tether not backed by USD. BTC price falls as people realize that when TETHER prints money they "buy" BTC, which artificially inflates the price. The ponzi continues to work as long as BTC holds it's value.
When BTC doesn't hold its value the ponzi explodes, USDT goes to 0; BTC bubble bursts. Bubble bursts causes panic sells, whales dont buy the panic until it's pennies on the dollar. Some cryptos like ETH survive this because they are amazing projects on their own however 99% do not survive and go to pennies.
jesus, that's bleak.
good thing I bought ETH yesterday during the dip for under 900 each ;)
Ha, My mind can go into some very dark places ;) The way I look at tether is that if it was legit, they would have a huge incentive to come clean. They've now fired the auditor which means they have a lot to hide. Honesty is the best policy. ETH has doubled it's pair vs BTC over the past month and I think it will continue to do that.