The Tether company, the issuer of the largest stablecoin, USDT, has responded to claims that the stablecoin is not adequately backed by reserves.
This was coming after a Wall Street Journal article said there were doubts about the company’s reserves. A recent article in the publication said there was a long pending demand for the company’s audited information.
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 about the principle of International Financial Reporting Standards.
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.
The Tether company has been labeled controversial in time past. Tether’s claim of being supported by $1 has been refuted following a report which shows that 2.9% of USDT is supported by fiat money.