Tether (USDT), the largest stablecoin issuer by market capitalization, dismissed claims by Bloomberg News about its reserve build-ups.
Bloomberg journalist Zeke Faux made some allegations about Tether in his news published Thursday. According to the report, Tether CFO Giancarlo Devasini used the company’s reserves to invest. This contradicts the claim that Tether’s supply is fully backed by reserves. Faux also accuses Tether of investing in Chinese companies and providing “billions of dollars in crypto-backed loans.” Faux was only able to confirm that a bank in the Bahamas is working directly with Tether.
“Tether has yet to reveal where it keeps its money,” Faux said. If Devasini risks profiting even 1 percent of all Tether reserves, that would mean a profit of $ 690 million a year for him and his partners. But if even a very small percentage of these loans fail, it means that Tether will be worth less than $ 1, ”he explained.
Tether said the report was an outdated effort to “damage the company’s reputation with innuendo and misinformation.” The stablecoin issuer questioned the credibility of Faux’s sources, arguing that the news was an effort to “discredit Giancarlo Devasini and other Tether executives,” while the USDT offer was “fully supported” by their reservation, as stated in your quarterly report.
Tether and Bitfinex agreed to pay a $ 18.5 million fine to New York State and provide detailed reports on its financial situation as part of a settlement with the New York Attorney General’s Office in February. Authorities have accused Tether of misrepresenting the extent to which USDT tokens are secured with fiat currency.