Tether Announces First Complete Reserve Audit by Major 'Big Four' Accounting Firm
While declining to reveal which specific firm, the USDT issuer confirmed the auditor comes from the prestigious 'Big Four' group: Deloitte, PricewaterhouseCoopers, Ernst & Young, or KPMG.
The company behind the world's leading stablecoin, Tether, has announced plans to engage one of the prestigious "Big Four" accounting firms to perform its inaugural comprehensive reserve audit.
According to a statement released on Tuesday, Tether revealed that the chosen accounting firm — whose identity remains undisclosed — will execute a "full independent financial statement audit" for the organization, encompassing its dollar-pegged stablecoin USDt (USDT).
The "Big Four" designation in the accounting sector refers to Deloitte, Ernst & Young, KPMG and PricewaterhouseCoopers.
According to chief financial officer Simon McWilliams, Tether indicated the firm was "selected through a competitive process." At the time of publication, Cointelegraph's request for additional comment from the company remained unanswered.
The comprehensive audit scope will encompass an examination of the company's assets, reserves, and tokenised liabilities, along with an "assessment of Tether's systems, internal controls, and financial reporting."
For the hundreds of millions of people and businesses who rely on USDT every day, this audit is not just a compliance exercise; it is about accountability, resilience, and confidence in the infrastructure they depend on
Tether CEO Paolo Ardoino
As of Tuesday, USDT maintains its position as the cryptocurrency sector's dominant stablecoin with a market capitalization of approximately $184 billion, representing more than double the $78 billion market cap of its nearest competitor, Circle's USDC (USDC). Despite this dominance, research published earlier this month by Japanese investment bank Mizuho indicated that Circle's stablecoin surpassed USDT in transaction volume for the first occurrence since 2019.
Why are Tether's reserves under scrutiny?
The stablecoin issuer maintains that all of its tokens "are pegged at 1-to-1 with a matching fiat currency and are backed 100% by Tether's Reserves." While Ardoino has publicly stated in the past that a substantial portion of its reserves is composed of US Treasurys, attestation reports from BDO Global have also revealed holdings including physical gold, Bitcoin (BTC), and secured loans.
Questions surrounding Tether's financial health gained prominence in December following a warning from BitMEX founder Arthur Hayes, who suggested the USDT issuer might encounter significant challenges should the value of its reserve assets decline. However, these assertions were challenged by James Butterfill, CoinShares' head of research.
The announcement of this comprehensive audit arrives several months following the enactment of the GENIUS Act in the United States, which created a regulatory framework for payment stablecoins. In response to this legislation, Tether introduced its USAt stablecoin in January, designed to comply with GENIUS requirements under the federal law, with Anchorage Digital Bank designated as the issuer.