Tether (USDT), the largest stablecoin issuer by market capitalization, has refuted the details of a Bloomberg story on its reserves holdings.

In a Thursday report, Bloomberg announcer Zeke Faux made numerous claims against Tether, including that its master financial officer Giancarlo Devasini has used the company'south reserves to make investments, that seem to contradict Tether's public position that the holdings were fully backed at all times. In improver, Faux alleges that Tether has invested in Chinese firms and issued crypto-backed loans "worth billions of dollars." Co-ordinate to the report, he was just able to confirm one banking concern in the Commonwealth of the bahamas was working directly with Tether.

"Tether still hasn't disclosed where it's keeping its money," said Imitation. "If Devasini is taking plenty risk to earn even a ane% return on Tether'due south entire reserves, that would requite him and his partners a $690 1000000 annual profit. But if those loans neglect, fifty-fifty a modest per centum of them, one Tether would become worth less than $1."

Tether chosen the report a "tired attempt" to undermine the visitor based on "innuendo and misinformation." The stablecoin issuer challenged the credibility of Faux's sources as an attempt "to discredit Giancarlo Devasini and Tether'south executives" and continued to claim its USDT tokens are "fully backed," citing its quarterly assurance reports.

In February, Tether and Bitfinex agreed to pay New York land $18.5 meg in damages and provide extensive reports on its finances equally part of a settlement with the New York Attorney General's Office — the most recent audit was filed with information reported as of June xxx. Government had claimed Tether misrepresented the degree to which its USDT tokens were backed by fiat collateral.

Related: Stablecoins under scrutiny: USDT stands past 'commercial newspaper' tether

The Bloomberg study comes as many speculate whether China'due south 2d-largest property developer, Evergrande Group, will default on $300 billion in debts. According to Faux, Tether denied holding whatever debt from Evergrande but would non confirm whether it held commercial newspaper from other Chinese firms.