[SilasX]

So wait, am I reading this right? They want to say that their holdings are audited, but want an auditing process that stops at "yes, this bank account as a $X balance" and doesn't include anything about who actually owns the account or what its liabilities are?

In fairness, I can kind of understand the bind: it seems that use-case of tethers depends on not being a legally enforceable claim to dollars, specifically so they can't legally be regulated as such (which would trigger reporting requirements, accreditation as a money transmitter, etc). But that's a double-edged sword: it also means that no (ethical) auditor will sign off on a statement saying they legally own the assets they claim to have.

[ttul]

For example... let’s say Bitfinex really does have $2.4B (or whatever) in the bank. But they have borrowed $2.3B using the cash as collateral. This is the sort of shenanigans that come out during an audit.