Crypto

The Wall Street Journal Attacks, Tether Responds. Who Won?

Is this attack on Tether part of The Wall Street Journal’s basic project versus bitcoin and crypto? Or did the paper feel the impulse to participate the Tether FUD action a couple of months too late? Did Tether rivals spend for this post or is it a natural piece of journalism? The WSJ post entitled “Tether Says Audit Is Still Months Away as Crypto Market Falters” generates numerous concerns. Tether’s response much more so. 

And we’re here to examine both.

The Wall Street Journal’s No Mercy Attack

The paper begins its examination with apparent realities, “Market observers have long questioned whether the firm’s reserves are sufficient and have been demanding audited information.” Nobody can challenge that. “The company has been promising an audit since at least 2017. An audit is “likely months” away, stated Paolo Ardoino, primary innovation officer of Tether Holdings Ltd.”

However, the business puts out a reserve report every once in a while. Does it not? Well, the WSJ separates what we obtain from what is required.

“Instead of a full audit, Tether, like other leading stablecoins, publishes an “attestation” revealing a photo of its reserves and liabilities, signed off by its accounting company.”

And estimates this violent declaration by John Reed Stark, previous head of web enforcement at the Securities and Exchange Commission.

“Tether needs an audit that’s akin to a corporate colonoscopy, that tells investors everything about what’s in their reserves.”

How can Tether recuperate from this? Keep checking out to learn.

Perceived Problems With Tether’s Accounting

Where you familiar with the current modifications in Tether’s institutional partners?

“In July, Tether switched accountants, from a small Cayman Islands-based firm to BDO Italia, the Italian member of the global BDO network. That firm, though, is a separate legal entity from BDO in the U.S.”

Well, in the post “Tether Responds to Disinformation in WSJ Article,” the business highly supports the organization.

“BDO, a very reputable and independent Top 5 audit firm, is not a “Tether accounting firm”, as incorrectly composed by the WSJ. BDO will continue to have unlimited access to any appropriate  info to perform their work and Tether will continue to share its attestations, in spite of constant efforts by the media to disparage its credibility.”

However, the WSJ views imprecision. Their significant issue appears to be with the truth that Tether has concealed cryptocurrencies as part of its reserve, and all of us understand how unpredictable those are. According to the paper, this is a threat since Tether’s accounting suffices too near to insolvency. 

“On Aug. 25, its $67.7 billion of reported assets outweighed its $67.5 billion of liabilities by just $191 million, according to its website. That means a 0.3% fall in assets could render Tether technically insolvent.”

Tether’s action to this is not a rejection. “To attack Tether’s reserves, when this margin also applies to other stablecoins on the market, further highlights an agenda by the publication,” their post states. According to Tether, the WSJ’s post’s goal is to harm the business’s credibility. A hit piece, say goodbye to no less. Plus, they insinuate they’ve been under attack and withstanding easily:

“Any reference to a margin of failure existing in Tether’s business model, assumes that the WSJ subscribes to the false short-seller narrative which suggests that short-selling Tether is even remotely possible.”

Tether, variety of financier on Intotheblock | Source: TradingView.com

Tether Answers More Questions

One of the weirdest and more perilous parts of the WSJ post is that it compares Tether with insolvent cryptocurrency loaning platforms Celsius and Voyager. None of those concern stablecoins, so, why is the paper putting them in a balance? The just possitive feature of Tether the paper states is that it “redeemed $7 billion of customer funds in 48 hours during the recent crypto crash without any problems.”

Tether wasn’t having those numbers, and reacted:

“Tether stands by the fact that it was able to easily redeem over USD 16B of the issued token in recent months.”

Besides that, the business attacks “Perhaps the WSJ has confused Tether with some of its competitors.” Admits “we have not had an audit and they know we are working towards one,” just to expose that none of its rivals has actually had one either. “Rivals have allowed mainstream consumers to believe they are “safer” since they have actually been “audited,” however no such audit has actually happened.”

Tether likewise safeguards its T-Bills reserve by declaring that “US Treasuries have been the premier safe asset worldwide.” And declares to be a successful service, “Tether has never disclosed any equity despite being profitable for several years.”

In any case, utilizing stablecoins indicates counterparty threat. Even though Tether did a great task resisting the Wall Street Journal, should you trust your cost savings to a business? We’re not in the sixties, a worldwide possession that doesn’t need trust currently exists. Why would you Tether if you can Bitcoin?

Featured Image by Mariia Shalabaieva on Unsplash | Charts by TradingView

FED, dollar bills

Michael Evans

Professional writer, editor, and producer with over a decade of experience. I'm an experienced editor who has written for a variety of publications, and I specialize in editing non-fiction articles, news, and business blogs.

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