Hindenburg Offers a $1 Million Bounty To Find Tether’s Reserves

A forensic financial research firm – Hindenburg Research – has launched the Hindenburg Tether Bounty Program. The program offers a $1 million reward to anyone who can provide details related to Tether’s stablecoin backing. The firm’s initiative establishes a major effort to solve a longstanding mystery looming over the entire cryptocurrency market. The Hindenburg Tether […]

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A forensic financial research firm – Hindenburg Research – has launched the Hindenburg Tether Bounty Program. The program offers a $1 million reward to anyone who can provide details related to Tether’s stablecoin backing. The firm’s initiative establishes a major effort to solve a longstanding mystery looming over the entire cryptocurrency market.

The Hindenburg Tether Bounty Program

As revealed in a company blog post earlier today, Hindenburg’s program intends to provide public clarity on Tether’s operations. Users who submit information about Tether’s reserves to Hindenburg may win up to $1,000,000 in rewards. The company believes the issue surrounding Tether’s backing poses a “systemic” threat to investors.

 “We feel strongly that Tether should fully and thoroughly disclose its holdings to the public,” said Nathan Anderson, founder of Hindenburg research. “In the absence of that disclosure, we are offering a $1,000,000 bounty to anyone who can provide us exclusive detail on Tether’s supposed reserves.”

As detailed in their post, Tether has become a key underpinning of the entire cryptocurrency market. It is the 5th largest cryptocurrency by market cap and has the greatest trading volume of any crypto by far. The stablecoin helps provide liquidity to investors who frequently conduct crypto trades as a short-term store of value.

Where Are Tether’s Reserves?

Tether’s legitimacy rests on whether its tokens are truly backed by 1:1 dollar reserves. Despite the company’s claims of integrity, they have yet to provide clear assurance that they possess such collateral. All disclosures the company has provided have been “opaque” and unreliable until now. For instance, while Tether claims to hold many of its reserves in commercial paper, it has not revealed the identities of its counterparties.

Recently, a journalist from Bloomberg conducted a detailed investigation on this very matter. He claimed that Tether’s commercial paper consists largely of short-term loans to Chinese businesses– a no-no in money markets. He also claimed that the company’s CFO is risking Tether’s reserves on personal investments. Tether aggressively dismissed this report, saying it used dubious sources to spin a defamatory narrative.

Days ago, federal authorities cracked down on Tether following suspicions that their token was not fully backed. The Commodities and Futures Trading Commission hit the company with a $41 million fine for untrue statements regarding its reserves. Earlier in the year, Tether also paid an $18.5 million fine to New York Attorney General Letitia James. She too was concerned about Tether’s backing.

The post Hindenburg Offers a $1 Million Bounty To Find Tether’s Reserves appeared first on Crypto Adventure.

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