What did the FSS report actually tell us about Tether?
On 20 June 2018, Tether Limited (Tether) released a report issued by law firm Freeh, Sporkin & Sullivan LLP (FSS). This report details work that FSS did for Tether, in performing a random check of their account balances to confirm USDT is backed 1:1 by USD.
Tether has been the topic of much debate since their previous banking partner, Wells Fargo, severed ties in March 2017. Then in January 2018 when their audit firm, Friedman LLP did the same, the critics appeared more justified. Their claim being that Bitcoin price is being manipulated by the Bitfinex /Tether partnership. More specifically, Bitfinex buy volume is being increased falsely by using alleged issuance of non-backed Tether, in turn causing Bitcoin price to increase.
So far though, all proof of this has been circumstantial and so any news that could provide more compelling evidence will be important to the situation. This latest report, goes in some way to adding to the legitimacy of Tether Limited.
Here’s the important parts of the report, in my opinion:
FSS is a legitimate company with a prestigious background, so on the surface this looks very positive for Tether Limited. Quickly after the release, social media headlines were saying ‘tether backed by usd’ etc. and the crypto community responded well to the news.
The report confirmed a number of things which add legitimacy:
However, they didn’t perform an audit, or any accounting work; and can make no assurance that the information they were given was valid and correct. This can be seen in the ‘additional details’ and conclusion:
For me, the only thing the report confirms is that on 1 June 2018, FSS asked for and received paperwork showing that the USD held in accounts by Tether was at least 1:1 with USDT and nothing else before or after this date.
Here is a copy of the report:
https://tether.to/wp-content/uploads/2018/06/FSS1JUN18-Account-Snapshot-Statement-final-15JUN18.pdf
What are you thoughts?
