Tether has finally delivered the formal audit it had promised for years, a development that stirred strong reactions across the crypto market. Supporters welcomed it as a breakthrough. Critics said it still leaves major questions unanswered.
Compared with the quarterly reserve attestations previously issued by BDO Italia, this audit marks a higher level of assurance. An attestation gives a snapshot at a point in time. An audit is meant to cover a fuller process.
A bigger accounting name, but not a full-group review
The audit was completed by KPMG’s U.S. practice, one of the Big Four accounting firms. The article describes that unit as the most authoritative arm inside the KPMG network. It also notes that the Big Four were once the Big Eight, a reminder that even large accounting firms with strong reputations are not immune from mistakes.
A central limitation is scope. According to the report, KPMG audited Tether International, not parent company Tether Holdings and not iFinex. iFinex is the control entity that also owns crypto exchange Bitfinex. The market may want to see iFinex audited as well, but that does not directly alter the conclusion of an audit focused on Tether itself.
That distinction matters because Tether reserves were historically used to fill a customer fund gap at Bitfinex. The article says the possibility of a similar episode, whether in the future or even now, cannot be ruled out by this audit alone.
An audit does not automatically make Tether more transparent
Tyler Menzer, an assistant professor of professional practice in accounting at Texas Christian University, told Protos that the report has limited value if the public cannot review the full financial workpapers submitted to KPMG. He added: 「Since 2000, 99.93% of audit reports on the market have ultimately resulted in unqualified opinions.」
In the article’s telling, receiving a KPMG audit does not mean Tether is now more transparent than it was before. Within Tether management and among some crypto industry figures, opacity is described less as a flaw and more as a deliberate design choice.
The market still cannot clearly see the makeup of Tether’s secured loans or what sits inside the “other investments” line on the balance sheet. It also remains unclear why 13% of reserves are held in volatile assets such as precious metals and Bitcoin.
Roughly 25% of Tether’s balance sheet is not made up of cash or cash equivalents. The article outlines a risk scenario in which the stablecoin issuer could become insolvent and fail to meet user redemptions. It also highlights that the share of cash and cash equivalents has fallen by more than 10% since the New York attorney general investigation.
The piece argues that if this asset structure belonged to a money market fund or another dollar-linked product, it would be treated as a serious weakness. On that basis, continued market caution around Tether’s reserves is presented as understandable.
Using the audit as marketing raises another concern
The article also questions Tether’s decision to promote the audit as a trust-building tool. It says that kind of presentation is unusual and more commonly associated with higher-risk assets such as penny stocks.
Before the creation of the U.S. Federal Deposit Insurance Corporation, banks and bank-like institutions often used audit reports to win over customers. By that comparison, the last time banks or shadow banks broadly leaned on audit results as a public trust signal dates back to the 1930s.
Past controversies are still unresolved
The 2025 KPMG audit does not clear up Tether’s earlier record, the article says.
Tether CEO Paolo Ardoino and former general counsel Stuart Hoegner had publicly promised audits for every year from 2018 onward. Menzer said going back to recreate those earlier audits is not realistic. For that to happen, an auditor would have needed to be involved starting in 2018 and to have had access to complete and clear original records throughout. That never happened.
The article says Tether has little incentive to reconstruct periods marked by reserve shortfalls and repeated crises. Full disclosure of those years would not help it prove reliability or corporate conduct, and it would not explain how the company moved through a period of effective insolvency without collapse. For that reason, readers are told not to expect audits for the early years.
Management had previously said an audit could not be completed because the process was “excruciatingly cumbersome.” Why that changed remains unclear. One public detail came from Ardoino, who has repeatedly said auditors physically counted every gold bar held by Tether. The article notes that this is basic work required for an unqualified opinion, not an extra point in Tether’s favor.
Several important questions are still open
The article says a larger question is how auditors valued Tether’s Bitcoin and other crypto holdings, and how much the audit itself cost.
Another issue remains unexplained: why it took more than eight months for the audit to be released. Under a normal timetable, accountants begin work at the end of a fiscal year and deliver the report early in the following year. A long process does not by itself mean the conclusion is flawed, but the delay leaves room for speculation.
The industry is also left with a broader question. What exactly was Tether trying to achieve by pushing through such an expensive audit?
If the company were preparing to go public, several consecutive years of full audits would usually be needed. Yet the article says there is no sign that Tether plans an IPO or a reverse merger. It also points to a technical limit: this audit used American Institute of Certified Public Accountants, or AICPA, standards, and those standards cannot be used for a public listing filing. A company seeking to list would need an audit under Public Company Accounting Oversight Board, or PCAOB, standards.
Set aside the goal of answering critics, and the article says it is hard to identify another clear practical motive for Tether to complete the audit at such cost.
Disclosure changes may be limited
As for what comes next, the article says the public should not expect many substantive disclosure changes from Tether.
Tether is no longer required to publish quarterly reserve reports, though it continues to do so voluntarily. Even so, reserve reports are not the same thing as high transparency. Even with a Big Four audit in hand, the report says the value for ordinary readers remains limited if the underlying documents submitted to KPMG are not publicly available.
One possible path is that Tether could switch to PCAOB audit standards if management eventually decides to pursue a listing, using the current AICPA audit as financial material for prior years.
The article ends on a narrow point: until Tether and iFinex disclose information at a level closer to that of major financial institutions, the practical value of this audit remains limited, and the public should not treat it on its own as a basis for trust.