Consumers' Research, a consumer advocacy organization, has put stablecoin issuer Tether under scrutiny.
On September 12, they released a report that raises questions about the company's transparency concerning the reserves backing its USDT stablecoin, particularly its claim of holding equivalent US dollar reserves. According to the organization, Tether has repeatedly promised to provide a full audit of its dollar reserves but has yet to deliver an independent audit from a reputable accounting firm.
This absence of transparency has raised concerns about Tether's practices, which, the report claims, could mirror the lack of oversight that contributed to the downfall of companies like FTX.
Did you know?
Want to get smarter & wealthier with crypto?
Subscribe - We publish new crypto explainer videos every week!
What Does Staking Mean in Crypto? (Easily Explained!)
In addition to the report, Consumers' Research sent an open letter to all US state governors, highlighting what it sees as a severe transparency issue within Tether. The watchdog group went further by accusing Tether of allowing bad actors to use USDT to bypass international sanctions.
Tether has previously taken steps to address some of the criticisms surrounding its operations. In July, the company hired Philip Gradwell, formerly the chief economist at blockchain analytics firm Chainalysis, to produce detailed reports on USDT's usage.
Additionally, Tether CEO Paolo Ardoino revealed in August that the company has recovered more than $108.8 million in USDT linked to illicit activities. Back in April, the company froze wallets using USDT to bypass US sanctions on Venezuelan oil.
The concerns raised by Consumers' Research, however, continue to put pressure on Tether to provide clearer evidence of its reserves and operations.
In other news, Tether has recently invested $100 million to acquire a 9.8% stake in Latin American agricultural giant Adecoagro.
