Tether Holdings, the reserve that backs the USDT stablecoin project is the largest stablecoin by market cap. The firm has recently announced that it is planning to publish the reserve report for the public to bring more transparency regarding its operations.
The firm already publishes reserve reports but at present, it has decided to increase the frequency of reserve data reports. Paolo Ardoino, the Chief Technical Officer and the next CEO of the firm, Tether will enable real-time publication of its reserves starting in the year 2024.
The decision to bring more transparency for the stablecoin has arrived at a time when concerns around stablecoin have increased among investors and regulators.
At present, Tether publishes its reserve reports at least once during 24 hours. At the same time, the holding company also issues monthly reports and quarterly review reports regarding the reserve.
For the 2nd quarter attestation report from an accounting firm called BDO, Tether Holdings incremented the reserves by $850 million. It means that the total excess reserve has risen to $3.3 billion.
Meanwhile, reports maintain that Tether held $72 billion in indirect investment in the form of US Treasuries via money market funds. The investment used US treasuries as collateral for overnight repurchases in the contract.
Tether CEO Incorporates Reserve Audit Following Changing Regulatory Landscape
Ardoino was recently promoted to CEO of Tether. He has shared plans to participate in the auditing process in addition to the introduction of real-time reserve reports. The CEO told CNBC that Tether will add auditing for USDT reserves while addressing the complexity of the project and risk management issues from top auditing firms.
The decision to publish the reserve reports coincide with the changing regulatory landscape for cryptocurrencies in European sector. EU legislators have passed MiCA laws that require stablecoin issuers to publish audited reserve reports.
MiCA is set to go into effect in 2024. The newly appointed CEO will continue to serve as the CTO of Bitfiniex exchange, the sister company of Tether. Austin Campbell, a financial consultant has talked about the pressure on the executive for carrying out the audit of Tether reserves in 2022.
He further retained that stablecoin issuers are facing increased regulatory scrutiny from legislators in USA. Tether is based in the British Virgin Islands. The firm paid around $40 million in 2021 to settle a lawsuit regarding its collateral contract.
Former Tether CEO Jean-Louis van der Velde is now added to the advisory board of the firm. Tether is planning to increase its workforce to 90 by the end of 2023.
Tether Freezes Wallet Accounts Associated with Terrorist Activities in Israel and Ukraine
Tether officials have recently blacklisted 32 addresses that were traced back to terrorist activities in Ukraine and Israel. The firm partnered with law enforcement agencies to track bad actors active in the territories.
On this account, Tether officials joined forces with National Bureau for Counter Terror Financing in Israel. The CEO told the media that the firm is actively working with law enforcement agencies to track and freeze wallet addresses that are associated with illicit funds.
On this account, the firm intercepted around $873K worth of USDT linked with suspicious accounts. Last year, the firm blocked $360 million in assets and reissued $100 million in USDT for the investors to account for the frozen USDT reserves.
To date, Tether has seized more than $835 million in USDT with the majority of funds associated with crypto exchange hackers.