Tether on FOIL and Continued Commitment to Transparency

Tether
by Tether | Jun 15 2023

Earlier this year, Tether, the premier stablecoin, completed its reporting obligations to the New York Attorney General’s Office under the terms of its 2021 settlement. That settlement called for reporting about Tether’s reserves each quarter for two years. Tether fully honored that obligation, and there has been no suggestion that the disclosures were incomplete or that the reserves were ever inadequate. We are pleased to have completed our obligations under the settlement. Today, Tether is stronger than ever, with its largest market cap in history.

Shortly after the settlement in 2021, CoinDesk sought, under New York’s Freedom of Information Law, public disclosure of materials relating to the first of Tether’s quarterly reports. This morning, the New York Attorney General’s Office provided responsive documents to CoinDesk. They provided these documents because Tether decided to drop its opposition to CoinDesk.

Tether initiated these proceedings in the first instance to prevent the public dissemination of confidential customer data and to prevent the use of sensitive commercial information that could potentially be exploited by malicious actors. However, our ongoing and demonstrable commitment to transparency means that we must prioritize openness over further time-consuming and unproductive American litigation that distracts from the real issues facing our community.

Among the documents disclosed are statements from Tether’s banks showing the full existence of our reserves, as demonstrated by our publicly-disclosed, independent, third party assurance attestations. Moreover, the statements show how Tether has been applying best-in-class asset management concepts: short-term investments and diversification, which is clearly visible from the investments listed in the various bank statements. Much has been made by our biggest detractors about the solidity and truthfulness of Tether’s backing. Accordingly, these materials should debunk all that unfounded FUD. Furthermore, the materials are outdated and do not accurately reflect the present state of our reserves, nor do they account for the transformative changes in our ecosystem. Tether, among other actions, reduced its commercial paper holdings to zero in mid-2022, and drastically reduced its secured loans portfolio, with the aim to bring it to zero in the coming months.

We find it suspicious that today’s attack on USD₮ via both DeFi and centralized exchanges occurred on the day that materials were handed over to CoinDesk. This timing raises questions. All the same, Tether has nothing to hide and we hold utmost confidence in the accuracy of our financial figures. While the sensitivity that we had to a government agency releasing confidential data—at least as it pertains to Tether’s reserves—is lower now than it was in 2021, we remain vigilant about customer data. While we cannot count on fair coverage from CoinDesk, which often misrepresented Tether’s position in the market in favour of its main competitor, we call upon them to set their bias aside and to not publicly share any past or current customer names and not to thereby put anyone in the community at physical or digital risk.

While CoinDesk is still likely reviewing the provided information, we are monitoring the USD₮ markets and looking for further signs of manipulation designed to spread panic when and if they decide to publish anything on this matter. Notwithstanding these risks, Tether has decided to take a strong stance in favor of transparency. The published information, if properly read and interpreted, only demonstrates publicly the legitimacy of Tether’s business and the existence of its reserves.

Tether is proud to be the leading stablecoin and a force for good in the community. We take pride in the deep liquidity of our reserves, in our strength and stability, tested throughout many black swan events that wrecked parts of the crypto industry but also the traditional financial industry. We will always defend our customers, our personnel, and our community against attacks.

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