LACK OF PUBLIC AUDITS HAS ALWAYS BEEN A PROBLEM FOR TETHER
Since its creation in 2014, for more than five years, Tether has been a subject to consistent criticism from both investors and experts in the cryptocurrency sector for its lack of public audits.
Last month, CCN spoke to iFinex, the company that oversees Tether, about its new Terms of Service which read that every USDT is backed by cash and other receivables, but not 100% in cash.
“Every tether is always 100% backed by our reserves, which include traditional currency and cash equivalents and, from time to time, may include other assets and receivables from loans made by Tether to third parties, which may include affiliated entities (collectively, “reserves”),” the altered Terms of Service read.
Kasper Rasmussen, the director of marketing at iFinex, told CCN that Tether is still 100% backed even though it may include other assets.
“Tethers remain completely stable and 100% backed, so Tether’s reserves always equal or exceed the number of issued Tethers. The only change is that the composition of the assets that provide that backing includes a combination of cash, cash equivalents, and may also include other assets or receivables from loans issued by Tether,” Rasmussen said.
HOW DOES AFFECT BITCOIN?
Immediately after the release of the New York Attorney General’s report, the bitcoin price fell below $5,400, indicating a dip in the confidence of the crypto market.