Tether's CTO Explains Why USDT is Still Not Audited

The Defiant


Today we are joined by Tether CTO Paolo Ardoino.

We discuss Tether's banking partners, its reserve composition, its latest attestation, and why the stablecoin issuer still hasn't presented an audit. Ardoino puts some of the blame on auditing firms.

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7 Key Takeaways

1- The simpler reason to exist for Tether is to create a tool that uses the same leverage, the same brilliant idea that Satoshi had called blockchain and just put the dollar on top of it.

2- The way Tether works is by opening an account on its website, doing the KYC AML process, and specifying a blockchain address. Then you wire money to their Tether bank account and they send you USDT to your wallet.

3- Tether is a centralized stablecoin, it uses blockchains as decentralized transport layers, but also has a centralized party because, as the issuer of the stablecoin, uses banks to hold cash, cash equivalents, and other assets that compose the portfolio and to process the transactions in order to issue and redeem tokens to its users.

4- Regarding disclosing Banking partners, As one of the customers of the banks, Tether says it is under the requirement of not disclosing the name of the banking partners themselves, but the information is available on the website and has been reported by multiple parties.

5- BDO is a big important auditor producing our quarterly attestation. BDO is the fifth auditor in the world and they are not looking at random numbers. They are contacting each one of our banking partners. They are getting information, deep information about our reserves.

6- Moody's, one of the top three Rating firms in the world, reported all of Tether’s banking connections, so it's not that they are trying to keep them hidden. They are all public already.

7- Tether has more than 3.3 billion in excess reserves and around 1.7 billion in Bitcoin. So it means that if Bitcoin would go to zero, Tether would still have more money than what is owed to users, around 1.5 billion.


  • 00:00 Intro
  • 01:11 How does Tether work?
  • 05:25 Tether Banking Partners
  • 13:45 Moody's Names Banking Connections
  • 25:56 Tether Attestation and Excess Reserves
  • 35:32 Why No Audit?
  • 40:00 Tether vs. Circle Attestations and CUSIP Codes
  • 42:00 Healthy Pressure