Almost six months after breaking up with his Tether auditor the company has finally released a third party prepared the report, which stated that its cryptocurrency, as stated, fully secured us dollar. However, this statement is accompanied by a number of significant reservations.
For several months, the state reserve funds Tether was the subject of debate: skeptics claimed that the volume of tokens produced by the company exceeds the margin dollars in her Bank accounts. In fact, the Tether was accused in the fact that it prints money dummy. The company has consistently denied the allegations, but did not adduce any evidence that the tokens provided dollars in the ratio one to one.
The truth in this matter is important for the entire cryptocurrency market, not only for the owners tablconv USDT market capitalization which, as of June 20, equal to $2.6 billion.
Lately, we have heard accusations against Bitfinex — cryptocurrency exchanges have a single Tether with the user. Supposedly the exchange by means of USDT artificially “inflate” the price of bitcoin. Last week a report was published of the experts sharing this point of view. In December, the staff of the Commission on urgent exchange trade of the USA has called on “the interview” leaders Bitfinex and Tether.
USDT, which, as a rule, is trading around $1, is used as a substitute for the U.S. dollar. With its help the traders in short time transfer of funds from one cryptocurrency exchange to another, preferring the token slow and difficult Bank transfers.
Given the importance of USDT to the ecosystem, independent confirmation of the fact that the token is really provided by the us currency could be called the long-awaited news, negate suspicions of manipulation and strengthening the confidence of market participants.
However, published on 20 June, the report will hardly be able to put an end to this question, given the reservations made and fairly narrow frame of analysis. First, this report is not the result of the audit. Its authorship belongs not to auditing or accounting and legal company Freeh Sporkin & Sullivan (FSS). According to representatives of the Tether, to conduct this audit is difficult, if not impossible. Some of the obstacles they referred to the lack of familiarity of the auditors with parameters and work conditions of the young sector; old-fashioned standards of accounting adopted in the period preceding the emergence of cryptocurrencies (hence the lack of understanding of how these rules apply); and finally arising from the above the need for auditors to decide and take responsibility — and for this they are supposedly not ready.
Freeh Sporkin & Sullivan in its report, has not used conventional methods of audit: it is in fact limited extract from the accounts of Tether at a point in time. And this point is very narrow: 1 Jun. As stated in the report of the legal company, it was “confident” that in this day the Tether had more money in banks than was in circulation of the token (namely $2.55 billion in two different institutions in the presence of USDT $2.54 billion). However, the report is not reported on the extent of the collateral at any time before or after.
In other words, the report does not confirm that USDT was provided dollars over a long period or is provided with them now.
The FSS founders — three former Federal judges. One of the trio, Louis Freeh, once headed the FBI. Before you hire FSS, Tether worked with audit firm Friedman. In September 2017, Friedman has released a preliminary report according to which as of 15 September, the Tether was $442,9 million in cash to ensure token USDT. However, as new FSS report, document the then auditors were very cautious and evasive in nature. For example, it stated that the Bank account recorded in the name of the Trustee and the relying party can not vouch that the Tether is subject to execution of a contract with that person.
Friedman had to conduct a full audit, but in January, Tether announced the severance of relations with the company, without specifying which party initiated the move. FSS did not comment on the episode, but said that the Tether not abandoned the plan to conduct an audit.
The full report FSS can be found here.
See also: What you need to know about Tether. Can this cryptocurrency to “drown” the entire market
Source
