Former US Securities and Exchange Commission (SEC) attorney has allegedly alleged that Tether is a “fake” and taken his concerns about the leading stablecoin seriously.
In a series of tweets, John Reed Stark, a former SEC enforcement attorney and founder of John Reed Stark Consulting LLC, has criticized Paolo Ardoino, the CTO of Tether.
He noticed that Bitfinex, the company behind Tether, operates ambiguously. According to regulatory measures, Stark noted that the lack of supervision, such as inspection and insurance, makes using Tether risky.
Claims on Tether’s Credibility and Solvency
Stark continued by stating that Tether’s use of its credentials as evidence of its financial stability is deceptive and unethical.
Stark Tweeted: “From my experience, The certification report is not standard. Not a legitimate term and ‘not even a thing.’ Proof of certification should be on a legal basis. Certification reports and IMHO are unethical and misleading.”
Notably, Stark’s statement draws on earlier Ardoino citations of similar assurances to prove Tether’s ability to pay off debt.
Claims That Tether does not equal the US dollar
Stark contested Ardoino’s statement that “Tether is equivalent to the US dollar.” He stated, “Tether is fake,” pointing out that Tether, often referred to as USDT, is attempting to imitate the US dollar style but lacks currency features.
“Tether is trying to disguise itself as a dollar. Or even make yourself look like the US dollar by labeling yourself as USDT. But Tether is not the dollar. And there isn’t any characterization by those norms. Both Tether and IMHO are copycats,”
John Reed Stark
Ardoino’s party, on the other hand, has yet to respond to Stark’s latest allegations. This time, the accusations against Tether are extreme.
Tether reports a net profit of $1.5 billion for Q1 2023. While revealing the development of market capitalization and reserves to the entire crypto community.
