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The newly promoted Tether CEO, Paolo Ardoino, has stated that the stablecoin issuer plans to release real-time data on Tether reserves in 2024 in an effort to boost transparency.
Tether has often come under scrutiny over its reserves and was also fined $41 million by the Commodity Futures Trading Commission (CFTC) in 2021.
Tether’s Move To Boost Transparency
Stablecoins have been met with considerable skepticism from regulators and the crypto community. One example is USDT, which is the largest stablecoin in the crypto space but also one that generates considerable controversy. This is because its underlying backing has often been called into question. However, with Paolo Ardoino taking the reins from December 2023, the company has announced plans to publish real-time reserve data. Ardoino is already the face of Tether, thanks to his tenure as CTO. The decision was revealed in a report published by Bloomberg.
Tether’s Struggles With Transparency
According to the Bloomberg report, Tether lacks transparency in multiple aspects and not just in relation to its reserves. The lack of transparency impacts its public offices, the independence of its board of directors, and even its overall structure. As such, many view Ardoino’s decision to publish real-time data about its reserves as a significant boost to transparency.
The community has been concerned about Tether’s reserves ever since the Commodity Futures Trading Commission (CFTC) ordered the stablecoin issuer to pay $41 million in fines in October 2021. The fine was levied on Tether because of its claims that the US Dollar fully backed the USDT stablecoin. However, Tether maintained that the Commodity Futures Trading Commission found no grievance against the company and stated that the order recognized that issues related to Tether’s reserves were resolved.
Tether also had to sign a $18.5 million settlement with the New York Attorney General over false claims regarding USDT backing. The AG’s office also ordered Tether to take steps to increase transparency.
“This resolution makes clear that those trading virtual currencies in New York state who think they can avoid our laws cannot and will not.”
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Author: Amara Khatri
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