Bitcoin Global News (BGN)
June 21, 2018 -- ADVFN Crypto NewsWire -- Just a week after an
academic research paper was published with significant evidence for
Tether being a market manipulation tool, it
seems that Tether has finally released a third party audit of its
reserves.
Since this is the case, then the
debate should be over as to whether Tether has enough cash
reserves, right?
Interestingly enough, it isn’t that
simple.
For starters, the findings that
were released yesterday are not so much a third party audit as they
are a short review.
Given that the review is only three
pages long and apparently full of disclaimers as well as little
substance, it’s reasonable to doubt its significance at this
time.
Even so, it is important to note
that the three page report was done by a law firm called Freeh
Sporkin & Sullivan, which makes it clear that it wasn’t a true
audit.
Tether executives, however, through
one of their chief lawyers, Stu Hoegner, argue that this is because
such an audit is not possible to do. Hoegner even went so far as to
blame this on the Crypto industry and to state that the inability
to be audited is normal for Crypto firms.
The fact that networks like
Cardano have proof that they have been audited,
however, brings this assertion into doubt.
In Cardano’s case, the audit was
done by a software engineering company called FP Complete, which
they have kept on retainer to perform such audits
regularly.
While this is also not an
accounting firm, it could be said to be logical that due to their
technology that underpins them, Blockchain firms cannot be audited
like any normal company.
Therefore, if this is taken to be
true, then Tether and Hoegner’s excuse is part truth and part
exaggeration. Blockchain firms can be audited. It is just a more
complicated process than it is with more traditional firms and so,
it could be surmised that Tether just isn’t willing to go through
it.
All in all, Tether still attempts
to state that their three page report demonstrates similar findings
to an audit, thus equating their work with FSS to Cardano’s work
with FP Complete.
Whatever the case, there is still a
major hole in the conclusions that were brought forth by
FSS.
Apparently, a good amount of
evidence exists that Tether was able to back up its cryptocurrency
offering with US dollars, as of June 1st. Specifically, the report
says that at this time, Tether had $2.55 billion to cover $2.54
billion in circulating tokens.
According to an analysis on the
subject by Coin Desk, however, the report did not mention
any other date and therefore, this semi-audit only proves that at
one point in time, Tether was probably able to cover its
circulating coins.
In the end, this means that we find
ourselves at the same place where we have always been, up to now.
Tether still hasn’t released any public documents that prove that
it consistently has enough cash reserves to hedge its crypto
tokens.
By: BGN Editorial Staff
News:
Tether
(USDT)
Cryptocurrency
Cardano
(ADA)
