Wondering what it could have been? It is a recent attack at USDT stablecoin issuer, Tether. At press time, the firm remains unsure if it has indeed survived the attack thrown at it or not.
What happened to Tether?
On Sunday, February 28, 2021, the firm was subject to a 500 Bitcoin ($24 million) ransom demand. Tether, however, refused to give in and let the deadline for the Ransom payment lapse. The firm was not affected in any way. No breaches or hack whatsoever.
When the ransom demand was sent, the person behind it threatened the USDT issuer with releasing information that would harm the Bitcoin ecosystem if the ransom was not paid. The USDT issuer chose not to pay and replied publicly, “We are not paying,” the public response contained the address where the ransom was to be sent.
Today we also received a ransom demand for 500 BTC to be sent to bc1qa9f60pved3w3w0p7snpxlnh5t4uj95vxn797a7. The sender said that, unless they receive the BTC by tomorrow, they will leak documents to the public in an effort to “harm the bitcoin ecosystem.” We are not paying. 2/5
— Tether (@Tether_to) February 28, 2021
The firm has alerted security agencies about the attempt to extort them and said it would offer full support to agencies ready to investigate the ransom attack. It also said it would take the ransom attempt seriously.
“While we believe this is a pretty sad attempt at a shakedown, we take it seriously,” the company tweeted.
From one trouble to another, Tether’s recent debacle
Only days back, The firm was faced entirely with another problem. The stablecoin issuer on Tuesday, February 23, was ordered to stop trading in New York. The Attorney General asked Tether to halt trading and fined the firm $18.5 million.
It stemmed from a document circulating online recently showing an email thread between an employee of the firm and representatives for Deltec, a bank in the Bahamas said to hold USDT reserves, that reignite questions about USDT backing.
“Bitfinex and Tether recklessly and unlawfully covered-up massive financial losses to keep their scheme going and protect their bottom lines,” said Attorney General Letitia James afterward.
Onwards, the stablecoin issuer will have to start providing regular reports on its business functions and give precise details on its reserves. The company is also mandated to publicly disclose the assets that back USDT, including loans from any other entities.
So far, however, The firm has not said anything about its reserve since the directive.