In a series of tweets, John Reed Stark, a former U.S. Securities and Exchange Commission (SEC) lawyer, has made serious allegations against the popular cryptocurrency Tether, suggesting it is involved in counterfeiting and lacking transparency.
Stark specifically targeted Paolo Ardoino, the CTO of Bitfinex, the company behind Tether, for failing to provide adequate oversight and regulatory measures.
Stark expressed concerns about Tether’s operations, stating that its use poses significant risks due to a lack of regulatory measures such as audits, inspections, and insurance. He criticized Tether’s reliance on attestation reports as evidence of financial stability, describing it as misleading and unethical. Previously, Ardoino had cited these attestations as proof of Tether’s solvency.
Furthermore, Stark disputed Tether’s claim of being equivalent to the U.S. Dollar, labeling it a “counterfeiter.” He argued that Tether attempts to mimic the U.S. Dollar but lacks the necessary characteristics of a true currency.
Stark highlighted Tether’s use of the USDT label as an example of this deception. Ardoino has yet to respond to Stark’s recent allegations.
This is not the first time Tether has faced criticism for its lack of transparency. The concerns raised by Stark shed light on the broader issues surrounding regulation, oversight, and the underlying value of digital currencies within the crypto industry.
The allegations made by a former SEC lawyer have added fuel to the ongoing debate about the legitimacy and regulation of cryptocurrencies. As Tether remains a widely used stablecoin in the crypto market, the industry will be closely watching for any developments or responses from Tether’s team to address these concerns.
