Tether, the company behind one of the biggest and most widely used stablecoins on the market (USDT), has updated the terms on its website to further clarify how their reserves work. The small update, however, suggested that its USDT coin is not 100 percent backed by US dollars, a claim many have come to criticize.
Tether Issues a Vital Update to Its Website
The world of cryptocurrencies has always been a tumultuous one, with new market-breaking scandals and scam allegations almost every day. Tether, one of the more controversial big players in the industry, has been under the spotlight since the creation of its stablecoin in 2014.
Many cryptocurrency experts and investors have questioned whether the company actually had enough fiat currency to back its eponymous stablecoin, especially as Tether has continually failed to provide conclusive insight into its reserves.
And now, after months of speculation and controversy, Tether responded to the issue, though not in a way the public had been waiting for. On Mar. 14th, the company issued a small, but vital update to its website, one that was spotted by a keen-eyed Redditor.
The update directly contradicts Tether’s claim that its USDT stablecoin is 100 percent backed by US dollars. While the company stated that every USDT token is “fully backed,” they added that they might not be backed by fiat currency alone.
New Terms Cast Doubt on Tether’s Credibility
Tether’s previous terms asserted that every tether is “always” pegged to traditional currency held in its reserves, saying that 1 USDT is always equivalent to 1 USD.
However, the newly updated terms, while vague, contradict that claim.
“Every tether is always 100% backed by our reserves,