Tether USDT is under scrutiny to disclose its reserve backing claim
Tether holds a large portion of cryptocurrency's total market capitalization, and is the third largest crypto by market capitalization the stablecoin has over the years underwent several court reviews in previous years, ordering the token issuer to disclose its claim of being a US-based backed reserve currency, currently according to data from coinmarketcap over $67 billion in tether makes the stablecoin third largest asset by market cap.
Claimed allegations on tether
Previous accusations against stablecoin issuer tether have been piling up since late last year some traders, accused tether issuers as responsible for bitcoin pump which was plummeting due to high selling pressure they claimed that large investors on Bitfinex exchange used unbacked stablecoin to hold the price of BTC, also a court ruling ordered tether last year, to pay a sum of $18.5 million when a New York attorney shut down Bitfinex exchange claiming the exchange does not have enough U.S. Dollars to back its stablecoin.
Bitfinex
Bitfinex founded back in 2012 is one of the oldest crypto exchanges operating in Hong Kong, tether USDT is owned by the bitfinex exchange.
The crypto exchange has been ordered by Judge Katherine Polk Failla in New York on 21th of September to provide reliable information about the backing of USDT, such information should cover the tether balance sheet, income statement, cash flow statement, and profit and loss statement with additional information on how trades are conducted using USDT.
Tether's lawyer claim disclosing such information could jeopardize the company's business.
What's in for tether?
What's in for tether, there could be an alarming issue for the stablecoin service provider leading to a crackdown hopefully not, binance started converting some stablecoin holding in its exchange into Binance Stablecoin (BUSD) last week which shows if there are more attack on tether stablecoin investors might start converting their USDT holding to a more flexible stablecoin to avoid terra UST incident.
