Judge Katherine Polk Failla of the United States District Court for the Southern District of New York ordered Tether to provide records of the 1-to-1 backing of its native stablecoin USDT.
In this order, Tether has been asked to produce “general ledgers, balance sheets, income statements, cash-flow statements, and profit and loss statements.”
Additionally, the decision mandates that Tether divulge information regarding its Bitfinex, Poloniex, and Bittrex accounts. The order was published as part of the case that began back in 2019.
The initial complaint was initiated by a group of investors against iFinex, Tether and Bitfinex’s parent company, claiming that the company manipulated the crypto market by issuing unbacked Tether with an intention to drive up the price of crypto like Bitcoin.
Last year, the CFTC charged Tether and Bitfinex $42.5M for violating regulations. The regulatory authorities did claim that USDT failed to hold its 1:1 ratio with USD. It was backed by reserves for only one-quarter of the time in between 2016 to 2018.
Judge Katherine Polk Failla’s order was contested by lawyers for Tether, who said it was utterly burdensome. However, the judge found that documents the Plaintiffs seek are clearly necessary in order to evaluate USDT’s backing with U.S. dollars.
“We had already agreed to produce documents sufficient to establish the reserves backing USDT, and this dispute merely concerned the scope of documents to be produced” Tether said in a statement.
Also Read: Tether Says Thesis Behind short-selling USDT Shows ‘Misunderstanding of Crypto Market’
