Why hasn’t Binance delisted Tether USDT yet?

Tether, or USDT, is a currency traded on many crypto exchanges under the nomer of “stablecoin” 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 how leading exchanges feel about it.

 

Tether and Binance delisting process

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

At Binance, we periodically review each digital asset we list to ensure that it continues to meet the high level of standard we expect. When a coin or token no longer meets this standard, or the industry changes, we conduct a more in-depth review and potentially delist it. We believe this best protects all of our users.

When we conduct these reviews, we consider a variety of factors. Here are some that drive whether we decide to delist a digital asset:

• Commitment of team to project
• Level and quality of development activity
• Network / smart contract stability
• Level of public communication
• Responsiveness to our periodic due diligence requests
• Evidence of unethical / fraudulent conduct
• Contribution to a healthy and sustainable crypto ecosystem

The much debated topic and our reasons for asking the question of Binance 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, and the lack of a note on their website informing visitors of the same, meet Binance’s criteria for a satisfactory:

• Level of public communication

On the 30th January of this year we published an article noting the lack of communication to be found on the website of Tether:

“Tether– The Tether website announcement section is a pretty barren landscape if you are looking for any kind of valuable updates. The most recent post dates all the way back to November 28th 2018. The are no financial reports available on the website, the only report being one paid for by Tether to investigate allegations the ”stablecoin” wasn’t actually backed by fiat, and is from June 20th 2018.”

Here we again have to ask if this is the level of information deemed sufficient to pass Binance’s listing criteria?

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:

 

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.

The question has to be asked of Binance, does this pseudo-transparency and the negative public sentiment surrounding it and the company in general match the requirement for this point of Binance’s listing/delisting t&c:

• Contribution to a healthy and sustainable crypto ecosystem

And the final point of concern for many is, does Tether with their statement that what they have said all along about a 1:1 match, is by own admission not entirely true, constitute a breach of Binance’s terms with regards to:

• Evidence of unethical / fraudulent conduct

We are of the opinion that all of the above constitutes a breach of many of the terms Binance adheres to in order to “best serve the interests of their customers” with regards product validity and is grounds for delisting of Tether USDT from Binance 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 Binance themselves.

Update 17 April 2019:

On the Binance website there is the following page: https://info.binance.com/en/all which at the time of writing is showing zero volume for USDT on Binance. We have once again asked Binance if they will respond and if with regards the below screenshot they are finally going to honour their own guidelines and de-list this probable scam coin.

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