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Monday, October 18, 2021

Tether Slams Reports Of It Using Reserves For Loans

Tether, which is the largest issuer of stable coin by market capitalization, has outrightly refuted the details of a story on Bloomberg. In a report that was published on Thursday, Zeke Faux- the journalist from Bloomberg- went on to make quite a few claims against this coin issuer, where it included that the chief financial officer of the company- Giancarlo Devasini- was utilizing the reserves of the company to make certain investments which went directly against the public position of USDT that stated that the holdings in this company were always fully backed. 

Tether Calls Bloomberg Report ‘Fake’

Along with that, Faux also stated that Tether was investing in Chinese firms while issuing loans that were crypto-backed. According to the report published, he was only successful in confirming one such financial institution in the Bahamas which was working directly with USDT. Faux reported that the company hadn’t disclosed where they stored their money yet.

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If the chief financial officer was willing to take enough risk to earn even a return of 1% on the entire reserves of their issues, it would earn him and his company partners an annual profit of around $690 million. But if the loans failed, this company would be worth less than a dollar. 

Tether, on its part, went on to call this entire report a tired attempt that was designed to undermine the company- founded on misinformation and innuendo. The issuer of stable coin went on to challenge the credibility of the sources of this journalist, stating they were created to discredit both Devasini and the executives of this company. The company further claimed that the USDT tokens were completely backed, and it could be proved by simply perusing the assurance reports. 

Back in February, Bitfinex and Tether had decided to pay the state of New York a sum of $18.5 million in damages, as well as provide multiple extensive reports on the valuation of its finances. 

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