US Consumer Protection Organization Warns Governors of States: Transparency Issues in Tether Reserve

In a report released on September 12th, consumer protection organization Consumers' Research issued a warning to stablecoin issuer Tether, accusing the company of issues with transparency in its US dollar reserves.

The organization claims that although Tether has repeatedly promised to audit its reserves, it has not yet provided any complete audit report on its US dollar reserves from a large accounting firm. The report author believes that this lack of transparency is similar to the situation before the collapse of FTX and Alameda Research.

The organization also released an open letter to the governors of various states in the United States, reminding them of Tether's lack of transparency. In addition, the consumer monitoring organization also elaborated on its allegations through advertising and setting up a dedicated website.

At the end of the report, the organization also accused Tether of collaborating with criminals and failing to prevent illegal entities from using USDT to evade international sanctions.

Despite doubts, the market is not overwhelmingly questioning Tether's reserves. In January of this year, Cantor Fitzgerald, a US securities portfolio management company responsible for managing Tether assets, assured the public that Tether has sufficient cash reserves. The CEO of the company stated at the time:

According to our investigation, they do indeed possess the funds they claim to have

In order to enhance transparency, Tether also hired former Chainalysis Chief Economist Philip Gradwell in July to write USDT adoption reports, which will be provided to US regulators and investors to help explain the use of stablecoins.