Cynical observers of the cryptocurrency markets have long suspected that Tether the USD backed coin was dodgy. The owners say they have one USD in the bank for every Tether they sell but there is no audit. Today the auditors resigned (allegedly.)
Why does this matter?
If you hold Tether
You could wake up to find it is worth a fraction of a USD.
If you trade on Bitfinex
The same people own Tether and Bitfinex. If Tether goes down it might drag Bitfinex down.
If you trade elsewhere
Many Exchanges including Bittrex and Poloniex do not support USD trading but use USDT instead. Any customers holding USDT will be unhappy. The Exchange might spread the pain to other customers like Bitfinex did when it was hacked.
If you HODL BTC or other coins
The market might wake upto the fact that Tether and Bitfinex have being doing a massive pump and dump on BTC. This could undermine its value.
What should you do?
It’s your call – tell me in the comments what you think about this issue and what users should do.