Responding to claims that the stablecoin is not adequately backed by reserves, Tether described the allegations as ‘unsubstantiated conclusions’. After a Wall Street Journal article said there were doubts about the company’s reserves, Tether reacted with a clarification. A recent article in the publication said there was a long pending demand for the company’s audited information.
‘Tether Singled Out On Stablecoin Reserves’
The Tether management felt it was targetted with respect to its stablecoin reserves. When the margin also applies to other stablecoins in the market, Tether was singled out, it said. The company said it has been making transparent disclosures as it works towards an audit. It refuted the publication’s claims that its business is not profitable. The management also reiterated that it was able to easily redeem over $16 billion of the issued token in recent months.
“Tether’s disclosures have been the most honest and transparent in the market – everyone knows that we have not had an audit and they know we are working towards one. To assume that our business is unprofitable is false. According to our Consolidated Reserves Report, Tether has never disclosed any equity despite being profitable for several years.”
Lack Of Accounting Standards For Stablecoins
The Wall Street Journal article indicated that crypto firms are not quite transparent when it comes to their financial statements. It added that there are no set accounting standards for digital assets even if companies perform audits. Reacting to this claim, Tether said it will provide full transparency in reference to the principle of International Financial Reporting Standards.
“Tether is committed to maintaining its role as the leading stablecoin in the market and we will continue to demonstrate our transparency, regardless of naysayers.” However, the company agreed that as of now there is no recognized standard for digital assets accounting, including for stablecoins.
Earlier in August, the company officially announced it was working with a top public accounting firm BDO Italia. It revealed plans to release monthly reports on financial reserves behind the stablecoin.
The post Tether Refutes Allegations Of Inadequate Stablecoin Reserves appeared first on CoinGape.
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