According to Leonardo Real, the chief compliance officer of Tether LLC, there is a smear campaign against Tether enacted by Bloomberg and other bad-actors, to misinform the public about the company. According to Real, there have been reports about their partner, Bahamas-based Deltec Bank, who are suspected of being involved in a Venezuelan money laundering case, which is “fake news” intended to damage Tether’s reputation. Tether’s COO laid all out on the table for Cryptonews.com, however, he did not divulge the culprit behind the campaign.
It’s been reported that Tether (USDT), a 1:1 USD pegged stablecoin, and cryptocurrency exchange Bitfinex, who have overlapping management and owners are being investigated by the US Department of Justice for market manipulation.
The firms originally jumped on the radar following USDT’s fall from a dollar parity back in October, when the stablecoins rate dropped down to $0.85 on the Kraken exchange briefly.
Real has been adamant that USDT is fully backed by reserve fiat currency, and has reiterated that reports released by Friedman LLP and Freeh Sporkin & Sullivan, two US-based accounting firms will attest to the backing.
Originally, the “smear campaign” can be traced back to University of Texas Professor John Griffin and co-author Amin Shams, who issued a paper back in June, with the claim that Tether shows a pattern of underpinning, and manipulating the flagship digital currency, Bitcoin, by purchasing the crypto during suspicious dips in its price. Tether and Bitfinex CEO, JL van der Velde, rebuked the accusations, claiming that it’s just hearsay.
According to the Bloomberg report in question, prosecutors have “recently homed in on suspicions that a tangled web involving Bitcoin, Tether and crypto exchange Bitfinex might have been used to illegally move prices.”
Leonardo Real counters that argument by stating that Tether could have only been used to manipulate the price of Bitcoin if it was unbacked by the US dollar.
“The story put forth by Bloomberg cites an unbacked, independent study which claims that, if USDT were to be unbacked it could indicate manipulation of the Bitcoin price. The entire study relies on the assumption that USDT is unbacked and therefore not sufficiently driven by trader demand. This is flawed, and claims which suggest that USDT transactions aren’t driven by demand when it is consistently in the top 2 of traded cryptocurrencies in the space with regards to volume, are simply ridiculous by now.”