Following the economic depression caused by the pandemic, the world’s largest stablecoin ,Tether continued to grow in heaps and bounds; so much that some people began to view the token as a serious threat to the United States’ financial system.
Watchdogs sniffed, and eventually, in July, the heads of the key regulatory authorities convened to discuss the stablecoin.
The main source of concern for the financial authority was allegations that Tether’s dollar holdings assertion was false.
Investigations were carried out in the last few months and today revelations emerged that Tether Holdings Ltd, the issuer of Tether, gave out loans worth billions of dollars to crypto firms.
According to Bloomberg’s story, cryptocurrency lending company Celsius Network secured a $1 billion loan from Tether, infuriating regulatory officials.
The findings also reveal that Tether’s reserves include multibillion-dollar short-term loans to Chinese enterprises.
Tether, in a strong response to the allegation said the report by Bloomberg is nothing more than misinformation peddled by “disgruntled individuals” who are bent on undermining its achievements.