Just in, Tether (USDT), the top most stablecoin issuer (in terms of volume) is all set to undergo a full audit by an auditing firm listed in the top 12. This is going to be done with the sole aim of proving its integrity and transparency to the public. Hence, this would seriously re-establish back their faltering trust.
Why is this necessary at all?
We are sure most of you do remember the recent Terra Luna fiasco where the popular algorithm stablecoin, UST had depegged and failed. This had caused a widespread panic scenario throughout the entire crypto market that eventually made the whole market go into a short-term downtrend. Investors even tried to cash out from the other stablecoins in fear that they would fail too. Hence, many other stablecoins also temporarily lost their dollar peg under the extremely volatile market pressure, one of them being Tether (USDT) and later on, another popular algorithm stablecoin, USDD (by Tron) which was thought to be the successor of the failed UST also lost its dollar peg. As per the CoinMarketCap website, USDD is still under the $1.
Hence, due to all these negative factors, many have even started to question the integrity of USDT as well. Some have even pointed out that the firm MHA Macintyre Hudson (previously, Moore Cayman) which normally conducts the internal audits of Tether so far is currently under investigation in the UK on the charges of purposely conducting and reporting a faulty audit report in 2018. Hence, this also raises the question of whether this auditing firm has been truly just while reporting Tether’s audit.
What do the Tether officials state?
Tether’s CTO, Paolo Ardoino has stated that to put a rest to all these FUDs once and for all, they have decided to invite one of the top 12 auditing firms in the world to conduct a full audit report of the company. This will prove to everyone the true and clear integrity of the company. He further added that it was not possible to invite one of the top 4 auditing firms as those firms don’t normally want to deal with anything uncertain and unregulated like crypto. Hence, trying to get them to do this would prove futile.
I think its one of the top 12, so not that bad,. The big four are a bit more cautious about providing a full audit when the rules are not clear.Tether’s CTO, Paolo Ardoino
He further commented regarding his thoughts about other stablecoins:
“If you market something as a stablecoin, it should be stable, full stop. You cannot have a guy who wakes up in the morning and creates a new cryptocurrency, backed by another cryptocurrency, backed by good will, and call it a stablecoin.”Tether’s CTO, Paolo Ardoino
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Disclaimer: This article isn’t a piece of financial advice. DYOR before taking any action.