Tether Confirms Its New Banking Partner Is Deltec Bank, Provides Proof of Funds

Siamak Masnavi

On Thursday (1 November 2018), Tether announced that it had set up a banking relationship with Deltec Bank & Trust, which is based in The Bahamas.

This is how Tether announced the news on Twitter:

Over on its website, Tether gave an explanation for their silence over the past few several weeks about their banking arrangements. Deltec had only accepted Tether after performing extensive due diligence:

"This included, notably an analysis of our compliance processes, policies and procedures; a full background check of the shareholders, ultimate beneficiaries and officers of our company; and assessments of our ability to maintain the USD-peg at any moment and our treasury management policies. This process of due diligence, was conducted over a period of several months and garnered positive results, which led to the opening of our bank account with this institution."

To reassure holds of its stablecoin (USDT), Tether stated that:

  • Deltec would be reviewing them on a regular basis.
  • It is "registered with the Financial Crimes Enforcement Network of the US Department of the Treasury and maintains the highest standards of AML/CFT procedures."
  • USDT is fully collateralized with USD deposits at its bank(s).

However, to really hammer home the point that it was solvent (unlike what some people were saying on Twitter and on other social median platforms), it provided a letter dated 1 November 2018 from its new bank that seems to confirm that Tether does indeed have a balance in its USD account of $1,831,322,828, which exceeds the amount of tethers currently in circulation:

Deltec Letter.png

Although this letter will by no means satisfy Tether's harshest critics (such as Twitter account "Bitfinex'ed") since it does not qualify as any kind of audit, there is no name of a bank official on the letter, there is no official stamp, and there is only the mention of the USD balance as of close of business on 31 October 2018 with no accompanying statement showing when the account was opened and what activities have taken place since that date.

Twitter user "Bitfinex'ed", who is probably the most vocal critic of both Tether and Bitfinex, had this to say about today's announcement:

However, with regard to full audits of fiat-backed stablecoins, we should recall the words of Cameron Winklevoss, co-founder and President of Gemini Trust, who said on 17 October 2018:

According to data from CryptoCompare, Tether (USDT) is currently trading at $0.9926, and the number of tethers in circulation is 1,776,421,736. 

Featured Image Courtesy of Tether

Zcash 'Company' Changes Name to 'Zerocoin Electric Coin Company' for More 'Clarity'

The Zcash company, which supports the ongoing development of the Zcash (ZEC) platform, a leading privacy-oriented cryptocurrency, has rebranded to the Electric Coin Company.

According to an official company blog post, the name change from “Zcash company” to “Electric Coin Company” was made in order to have more clarity. Explaining that the “legal name” for the firm was always “the Zerocoin Electric Coin Company, LLC”, the organization clarified that it had been referring to itself as “the Zcash company.”

However, the company’s blog noted that the development of “Zcash” is a community-based project and that some of the privacy coin’s business-related initiatives may involve the Zerocoin Electric Coin commercial entity. Moreover, Zerocoin’s operations are not directly associated with the Zcash Foundation - which in itself is a “separate and independent” organization, according to the z.cash blog post. Notably, the Zcash Foundation has “its own mission, team, and board of directors.”

Rebranding Process: New Domain, Change Office Sign

Acknowledging that it will take the company “a little while to get the new branding right, launch a new domain, and change out the sign at the office”, the company blog mentioned that “the name change is public.” Except for the name change, the entity associated with Zcash explained: 

We are the same team, with the same mission: to empower everyone with economic freedom and opportunity. We developed and help steward Zcash.

Zerocoin's Research & Engineering Projects May Not Be Integrated Into Zcash 

Notably, the Electric Coin Company is currently working on “research and engineering [projects] that may, or may not” be integrated into the Zcash codebase, the blog noted. At present, the Electric Coin team consists of around 30 professionals from across the globe that are involved in the following initiatives:

  • “Product Development and Support”,
  • “Builds Zcash software”,
  • “Participates in cryptographic research”,
  • “Works with third parties to perform regular security audits of Zcash”,
  • “Improves the safety and security of the Zcash network”,
  • “Works on the Zcash user experience, such as the reference wallet” 

Company Website, Social Media Accounts To Be Changed/Updated Soon

In addition to working collaboratively on the initiatives listed above, the Electric Coin company helps in “translating content into different languages”, creates "educational content”, and supports the overall development of the Zcash platform.

As mentioned in the company’s announcement, the Electric Coin company “information will be moved from https://z.cash/ to a new domain with its own website.” Social media accounts associated with the company will also be updated.