Why hasn’t Kucoin de-listed Tether USDT yet?

Tether, or USDT, is a currency traded on many crypto exchanges under the moniker of “stable-coin” has come in for much criticism recently (well pretty much always). With public sentiment ranging from it’s a scam to “Meh its safe because their website says so” we ask the question why leading exchanges aren’t de-listing it.

Tether and Kucoin’s de-listing process

As we have previously reported Kucoin delists coins from their exchange citing the following reasons (among others):

Risk of being de-listed after the observation period, in case of any of the following situations (“Negative Situations”):

1. Low liquidity for a certain period of time.
2. The project ceases or is likely to cease its operation or business activities for 3
   months.
3. The project fails to inform KuCoin of its material change(s).
4. The project fails to cooperate with KuCoin for regular routine inspection.
5. There is a security issue about the project’s technology.
6. The project development is not carried out according to the roadmap planned in
   the white paper, and there is no announcement of the progress on the project’s
   official website.
7. The project’s information disclosure is incomplete, misleading or untrue.
8. The project is insolvent or a step, order or proceeding for liquidation,
   bankruptcy, insolvency or similar is taken, made or commenced against or in
   relation to it or any material part of its assets.
9. The project or its team member (including but not limited to founders,
   consultants) is under investigation for a suspected breach of or is convicted for
   an actual breach of any applicable laws, statutes and regulations.
10. The project carries out market misconduct such as wash trading, market
    manipulation or insider trading.
11. Any other situation KuCoin may deem risky for its users or platform.

The much debated topic and our reasons for asking the question of Kucoin centers around the following announcement (Tweet) by Tether:

On February 26 Tether updated its ToS, which was directly communicated to customers on the same day and required active opt in. Tethers remain completely stable and 100% backed, because Tether’s reserves always equal or exceed the number of issued Tethers. https://t.co/VAW50rRfBn

— Tether (@Tether_to) March 14, 2019

Does a tweet 16 days after the change in ToS, mean that KuCoin was previously aware of this fact in accordance with their listing requirement:

• The project fails to inform KuCoin of its material change(s).

If this tweet was also the first notification to Kucoin (if they even saw it), and if not, why did Kucoin not inform their customers?

A lot of the negativity surrounding Tether concerns the lack of transparency they offer to confirm their claim that each USDT is matched 1:1 by USD reserves. The update released by Tether actually fuels the debate about the validity of this claim as it can/is being seen by many as proof of non-adherence to the statement.

The tweet states that “Tether’s reserves always equal or exceed the number of issued Tethers” and refers the reader to their “Transparency” page on their website and surely therefore breaches the following of Kucoin’s requirements:

• The project development is not carried out according to the roadmap planned in
  the white paper, and there is no announcement of the progress on the project’s
  official website.

and

• The project’s information disclosure is incomplete, misleading or untrue.

Without any available audits, and with no clear description of what the “Total assets” actually are, this “Transparency” is as clear as mud as it offers no proof other than being written on their website.

We are of the opinion that all of the above constitutes a breach of many of the terms Kucoin adheres to in order to “best serve the interests of their customers” with regards product validity and is grounds for de-listing of Tether USDT from Kucoin exchange. As we are not lawyers we cannot state our opinion as fact and would therefore be delighted to hear from those in the crypto community and from Kucoin themselves.

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