CFTC Orders Tether and Bitfinex to Pay Fines Totaling $42.5 Million.
= Tether to Pay $41 million Over Claims that Tether Stablecoin was Fully Backed by US Dollars.
= Bitfitnex to Pay $1.5 Million for Illegal Transactions While Operating Bitfinex Cryptocurrency Trading Platform and Violation of Prior CFTC Order.
Just a sample:
As found in the order, Tether held sufficient fiat reserves in its accounts to back USDT tether tokens in circulation for only 27.6% of the days in a 26-month sample time period from 2016 through 2018. The order also finds that, instead of holding all USDT token reserves in U.S. dollars as represented, Tether relied upon unregulated entities and certain third-parties to hold funds comprising the reserves; comingled reserve funds with Bitfinex’s operational and customer funds; and held reserves in non-fiat financial products. The order further finds that Tether and Bitfinex’s combined assets included funds held by third-parties, including at least 29 arrangements that were not documented through any agreement or contract, and that Tether transferred Tether reserve funds to Bitfinex, including when Bitfinex needed help responding to a “liquidity crisis.”
How is this not surprising? Their unaudited "audit" said as much!
What may be surprising is that USDT has barely moved in price. Now, what would happen if investors moved out of USDT? What would they move into?
Interesting that this hype should come out at the same time as the Tether news:
Bitcoin Touches $60,000 Amid Hype of ETF Approval
Buy the news - suspend reality.
How dare Tether operate like a central bank, and then have the audacity to be successful at it. Everyone knows only a handful of experts with government military backing have the right to operate in such ways. Shame, shame.
They should put that in their prospectus: "Tether is backed by the fear of violence."
That should do it.
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