Tether Reserves Audit Delayed for Months, Says the CTO
Tether is now the biggest among the stablecoins as its market capitalization is up to $68B. Nonetheless, notwithstanding the frequently made promises of turning into more transparent, Tether has not yet issued a complete audit of the reserves thereof, causing a debate among the critics of the platform.
Financial Audit Delayed
The CTO of Tether, Paolo Ardoino, has stated that a delay of several months will be witnessed in Tether reserves’ complete review. The cause at the back of the respective procrastination has not yet been provided by the venue. Thus a lot of criticism has been allured by this from the people who consider that the company has not been sufficiently transparent in terms of the reserves thereof.
The query related to which assets are held by Tether has ignited a fire within the community of cryptocurrency for a considerable time up till now. As per the unique report from Tether, the platform had up to $66.4B in its assets as well as $66.2B in liabilities. Nevertheless, a noteworthy thing is that the respective reports are developed on the behalf of Tether instead of any autonomous auditor. Notwithstanding the promises made by them, it has been up to 5 years that the community has been waiting for Tether to provide a full-fledged audit.
The increasing vagueness of the stablecoin space is posing additional hazards to the broader market. While one is not definite about what (and in how much amount) is backing something, a great issue can be confronted by the overall industry. If there are not sufficient reserves under a specific stablecoin as opposed to the assertions, then there is a hazard of generating fake currency, a surely illegitimate process.
Circle Competes Tether with Provision of Audits
Not just this, however, if many people attempt to withdraw the stablecoin in return for dollars, a bank run can eventually be caused, resulting in the de-pegging of the stablecoin. In the previous year, a lot of popularity has been gained by Circle somehow because of its audits. As opposed to Tether, monthly reports are issued by Circle showing the treasury bill in their possession and the cash deposits kept by them, and so on. That is a reason for a spike in its market capitalization in recent years.
