US regulator orders Tether to pay $ 41,000,000 in fines – Here’s why – .

US regulator orders Tether to pay $ 41,000,000 in fines – Here’s why – .

The Commodities Futures Trading Commission (CFTC) orders entities behind Tether stablecoin (USDT) to pay $ 41 million in fines.

According to a new press release, the CFTC accused Tether Holdings Limited, Tether Limited, Tether Operations Limited and Tether International Limited of making “false or misleading statements and material omissions” related to the USDT.

The USDT is pegged to the US dollar, and Tether claims that it is fully backed by the corresponding fiat assets, including the dollar and the euro.

According to the statement, the regulator looked at 26 months between 2016 and 2018 and found that Tether only had sufficient reserves to fully support the USDT on 27.6% of the days examined.

“In fact, the Tether reserves weren’t ‘fully supported’ most of the time. The order further finds that Tether did not disclose that it included unsecured debt and non-fiduciary assets in its reserves, and that Tether falsely stated that it would undergo routine professional audits to demonstrate that it maintained “100% reserves at all times”, even though Tether’s reserves were not audited.

The CFTC also reports that Tether has drawn its reserve funds from the operational and client funds of the crypto exchange Bitfinex.

“The ordinance also finds that instead of holding all the reserves of USDT tokens in US dollars as represented, Tether has relied on unregulated entities and certain third parties to hold funds including the reserves; reserve funds mixed with Bitfinex operational and customer funds; and held reserves in non-fiduciary financial products. The order further finds that the combined assets of Tether and Bitfinex included funds held by third parties, including at least 29 agreements that were not documented by any agreement or contract, and that Tether transferred the reserve funds from Tether to Bitfinex, including when Bitfinex needed help responding to a “liquidity crisis”.
Don’t Miss a Beat – Subscribe to receive crypto email alerts straight to your inbox

follow us on Twitter, Facebook and Telegram

Surf the daily Hodl Mix

Check out the latest news headlines

Disclaimer: Opinions expressed on The Daily Hodl do not constitute investment advice. Investors should do their due diligence before making high risk investments in Bitcoin, cryptocurrency, or digital assets. Please note that your transfers and transactions are at your own risk and that any loss you may suffer is your responsibility. The Daily Hodl does not recommend buying or selling cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in Affiliate Marketing.

Image en vedette : Shutterstock/klyaksun/WhiteBarbie


Please enter your comment!
Please enter your name here