The Tether order is related to a lawsuit that is still going on. The lawsuit says that unbacked USDT issuances have hurt the market by $1.4 trillion.
A U.S. judge in New York has told Tether to show financial records about the backing of USDT. This is part of a lawsuit that says Tether worked with others to issue USDT as part of a plan to raise the price of bitcoin.
The order says that Tether must produce “general ledgers, balance sheets, income statements, cash-flow statements, and profit and loss statements,” as well as records of any trades or transfers of cryptocurrency or other stablecoins by Tether, including information about when the trades happened.
It also tells Tether to give details about the accounts it has at Bitfinex, Poloniex, and Bittrex.
Attorneys for Tether tried to stop the order to release, saying that it was “incredibly overboard” and “unduly burdensome.” The judge, however, didn’t agree, writing that the “documents Plaintiffs seek are without a doubt important.”
Judge Katherine Polk Failla wrote, “The Plaintiffs make it clear why they need this information: to figure out if USDT is backed by US dollars.”
“The documents sought in the transactions RFPs seem to go to one of the Plaintiffs’ main claims: that the… Defendants engaged in cyptocommodities transactions using unbacked USDT, and these transactions “were strategically timed to inflate the market,” the Judge said.
At the same time, the New York Supreme Court is hearing a case to make the New York Attorney General release the documents he or she gathered while looking into Tether’s reserves. This case involves a news correspondence.
The New York Attorney General looked into Tether’s reserves, and in February 2021, they reached a settlement for $18.5 million.
