Stablecoin Tether publishes a banner report by law firm FSS, which confirmed on June 1 that the US dollar reserves are equivalent to the token, but the report contains some reservations.
Tether publishes transparency report
There have always been a lot of rumors and speculations about the Stablecoin Tether and if it is really covered by US Dollar (1:!). Tether has now issued a Transparency Report by the law firm Sporking & Sullivan LLP (FSS). However, the company did not conduct an official audit, but the report is based on the data that the company has received from the relevant banks. FSS is a Washington-based law firm founded by three former federal judges, including a former director of the FBI. The company explains:
The confirmation of bank and Tether balances should not be construed as a result of an audit and were not performed in accordance with Generally Accepted Auditing Standards.
Recent speculation has continued to increase on the basis of a recent study. The Company states in the report that “although we recognize our own lack of commitment to the wider community, we believe that much of the speculation and negative reporting is the result of misunderstandings about how Tether works.”
All of the outstanding Tethers are fully hedged by US dollar reserves. The reserves were always and will always correspond to the number of tethers in circulation.
According to the report, $ 2,538,090,823.52 of US dollar reserves were held by two different banks and this amount was confirmed by authorized bank employees. However, the amount confirmed by FSS on June 1st, 2018, was $ 2,538,090,823.52, which corresponds to the same amount of issued tokens. However, the amount confirmed by the banks goes beyond the tokens, but the report does not reveal any further information.
The report also states the company’s compliance system.
All issued, redeemed and existing Tethers, including all transaction histories, are publicly auditable. The tools Omnichest.info and Etherscan.io can be used for this.
The documents reviewed by FSS include financial information, an AMS advisory report, registration process, other bank-related paperwork, bank regulations for the issuance of tokens, personal information and material related to the number of issued and to-be-issued tokens.
Bloomberg reported on Tether’s Stu Hoegner statement: “The bottom line is that an audit can not be included.” He went on to say that the barriers to auditing are much larger and, at this point in the crypto market, generally difficult to overcome. Tether could have announced the Transparency Report long ago and it has its shortcomings, such as the fact that it was published by a law firm and not by an accounting firm. Also, the US dollar reserves were more at the time at the banks than the issued token itself. “
Marko Vidrih @cryptomarks
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