In a recent response to reports that the reserves of USDT, one of the largest stablecoins, once included securities issued by Chinese companies, Tether, the issuer of USDT, stated that they “do not condone” the behavior of the media outlets involved. These outlets, such as Bloomberg and CoinDesk, had cited documents released by New York’s Attorney General (NYAG) highlighting that USDT was once backed by securities from firms like the Industrial & Commercial Bank of China, China Construction Bank Corp. and Agricultural Bank of China.
Tether argued that the materials obtained by the media outlets are outdated, stating that the data sent to the media platforms is more than two years old. In its defense, Tether also clarified that its exposure to Chinese commercial papers was liquid and all of the issuers were stable. The company explained that the Chinese banking-related commercial paper at issue was rated A1 or better, and that its exposure to commercial paper holdings was reduced to zero last year. According to Tether, they did not lose any money on any commercial paper, including those issued by Chinese firms.
While some of the world’s biggest investment managers also hold these papers, Tether’s main concern is the potential negative impact of the reports on their reputation and customers. As a result, the stablecoin issuer denounced the way the media outlets presented the information, claiming it was done in haste and without proper consideration of current events or facts.
In essence, the controversy highlights the continuous push and pull between the potential of blockchain and cryptocurrency technology and the risks and uncertainties surrounding it, particularly from a regulatory standpoint. On one hand, the technology provides new opportunities for investment, decentralization, and global collaboration; but on the other hand, the lack of clarity and possible misinterpretations of information can potentially hurt the reputation of companies in the space and hinder the development of the industry as a whole.
While it is crucial for media outlets and regulators to scrutinize the activities of companies in the cryptocurrency space, it is also essential for these stakeholders to maintain a balanced and accurate representation of facts in order to ensure the healthy evolution of the industry.
Source: Cointelegraph
