Tether to publish real-time reserve reports for increased transparency

For years now, Tether, the company behind the Tether (USDT) stablecoin, has faced criticism for the lack of transparency regarding its reserves. The company now made a move that would lead it to publish real-time reserve reports.

Tether to introduce real-time reports starting 2024

According to the company’s recent announcement, the reports will start coming out in 2024, and it appears that the firm decided to make it as a consequence of increased regulatory scrutiny of the stablecoin sector. With the regulators finally getting involved and seeking greater transparency, Tether was forced to either respond or risk losing its footing.

Tether actually made a move to increase its transparency a long time ago, with daily updates to its reserve information, which can be found on its transparency page. Apart from those, the company was also publishing monthly reserve reports in addition to regular quarterly reviews.

The company started doing so after receiving a $42.5 million fine in 2021 when the US CFTC found that the company lacked complete backing of its assets over a period of 26 months — a period between 2016 and 2018.

Fortunately for Tether, the company’s growth trajectory did not suffer due to this setback. In fact, its recent quarterly attestation shows that the firm manages to maintain a $3.3 billion liquidity buffer, which ensures the stability of the USDT ecosystem while maintaining trust among shareholders.

The company holds a total of around $86.1 billion in assets, while its liabilities stand at $82.8 billion, meaning that its reserve backing is significantly over 100%. Tether even provided a breakdown of the reserves in the interest of increased transparency, plus a complete list of its USDT reserve custodians.

According to released information, the company has a surplus in shareholder capital cushion of approximately $3.29 billion across 15 different blockchains. The firm even authorized all of them, except for Polygon and Algorand, to issue large quantities of USDT. Solana had a pre-authorized issuance value of $1.57bn, even outperforming Ethereum with $617 million and Tron with $353 million.

Big changes at Tether

Tether did not address the importance of having pre-authorization for issuing tokens in relation to trust and transparency. However, it is worth noting that its transparency report has contradicted some of the current ongoing concerns regarding its liquidity and asset backing.

In 2021, the company was fined for sharing reserve-related statements deemed untrue. However, more recent reports did not raise any red flags. In fact, the authorities did not have any problems with Tether for the last two years. The company also saw a major change recently when its now-former CTO, Paolo Ardoino, became the CEO, after the previous CEO, Jean-Louis van der Velde, became the company’s advisor.