Tether’s billions clear as day: Major European firm to conduct reserve attestations

• Tether prepares to get rid of commercial paper backing for its USD stablecoin reserves without incurring losses.
• An Italian arm of a global accounting firm will conduct reserve attestations for Tether, increasing the transparency of Tether’s billions. 
• Despite bear market woes, Tether’s stablecoin USDT held its peg steady at $1. 

Tether has taken necessary steps towards greater transparency and better alignment with international accounting standards. The crypto market is faced with a bloodbath while Tether’s USDT stablecoin has successfully retained it peg at $1. 

Also read: What’s next for Ethereum if Coinbase bans staking?

Tether officially engages BDO Italia to conduct reviews of its reserves 

Tether Holdings Limited tapped the Italian arm of a renowned accounting firm to conduct regular reviews and attestations of its dollar reserves. BDO Italia will conduct an independent review of Tether’s stablecoin reserves and ensure that each USDT issued is backed by cash or cash equivalents. 

BDO Global is one of Europe’s five largest accounting firms. Tether roped in the firm’s Italian arm to work on attesting its reserves. Tether’s objective is to release public attestation reports monthly, instead of quarterly. The reports will include details about the number of USDT token issues and the reserves of the firm. 

One of Tether’s key concerns is the commercial paper in its reserves. Tether is prepared to get rid of its commercial paper backing, without incurring losses. The stablecoin firm announced this in June 2022 and by onboarding a new accounting firm, it's likely to make the transition from commercial paper to secure reserves. 

Paolo Ardoino, CTO at Tether commented on the development,

The utility of Tether has grown beyond being just a tool for quickly moving in and out of trading positions, and therefore it is mission-critical for us to scale alongside the peer-to-peer and payments markets.

Ardoino believes Tether pledges to offer higher transparency and liquidity to crypto traders. The stablecoin issuers have been criticized repeatedly for lack of transparency and inefficiency in disclosure of reserves. 

Tether holds its peg steady despite crypto bloodbath

Through the recent crypto bloodbath and double-digit decline in Bitcoin, Ethereum and altcoin prices, Tether’s stablecoin USDT has retained its peg at $1. The stablecoin has been questioned over its transparency and liquidity of its reserves in the past, however this did not negatively affect USDT’s peg. 

---