Reports Saturday night surfaced and Tether and their auditor Friedman LLP have dissolved their relationship. Due to the weekend, did not receive independent confirmation. The lawyer who called Friedman has gone to voicemail.
It seems unusual for any company to take such action without a formal statement, especially since it will lead to a blizzard. Many in the password community are worried about whether Tether really has enough reserves to redeem all the good tethered tokens. The company hired Friedman LLC to conduct an audit to address community concerns.
Very transparent
Taser has been the source of controversy for the past year, and the company has been working hard to respond to criticism. The company has the same ownership as Bitfinex, a major cryptocurrency exchange, last autumn wrote:
Friedman LLP has hired Tether Ltd to execute the historical balance sheet audit process.However, with the dramatic increase in the number of outstanding shares in recent months, we also asked Friedman to temporarily analyze our bank balances and the amounts we have issued And uncapped token balances, Friedman agreed to advise us in order to provide management with useful information about the Tether cash and tethered tokens issued and outstanding on the interim dates and Friedman can Use the program quickly to advise us on September 15, 2017. These consulting services do not constitute an audit or assurance business, including a significantly expanded process and take more time to complete. "
Any "disintegration" of the relationship between Tether and Friedman LLP can cause great skepticism in the community as it seems to run counter to Tether's desire to increase transparency.
What is it?
Taser (the company) claimed to accept investors' U.S. dollar deposits, after which they created the same number of tethers (currencies) and handed them to the depositors. Tether claims to have deposited $ 2.2 billion in its bank accounts, supporting every tether token in a 1: 1 ratio. However, without an audit, there can be no proof that Tarser actually had these reserves, or that they have not been used for something other than the support of tethered tokens.
Doubt and legal threat
Some in the digital money community are deeply skeptical about the issue of tethered tokens. It is not uncommon for companies to issue large amounts of $ 500 million to $ 1 million restrictions, leaving many wondering who the investors are depositing. Since the disruption of Bitfinex bank relations early last year, the exchange has relied heavily on its sister company tokens to move funds in and out of the currency markets. Some speculate that Tether may operate a fractional reserve, issue more tokens than they support, and send them to Bitfinex. The exchange then uses these tokens as collateral to create leveraged or short positions in the Bitcoin market.
In early December, Bitfinex threatened to take legal action against the anonymous blog Bitfinex'ed, based on allegations of wrongdoing Bitfinex and Tether.
RASHED
I also saw this news. Here is my understanding and I am looking for opinions on it: https://steemit.com/tether/@amdazed/thoughts-and-discussion-using-on-usdt-tether-crypto-currency-rumors-and-the-potential-to-crash-bitcoin-btc
You got a 4.19% upvote from @upmewhale courtesy of @rash3d!