Former SEC official John Reed made a ponzi statement for altcoins sold under the name of art. It also includes the largest stablecoin company in the market.
SEC official accused this company of running ponzi
The former SEC official has questioned Tether’s transparency in his latest tweets. According to Reed, who has worked with the SEC for almost two decades, Tether’s lack of transparency about its balance sheet is a sign that the company operates like a ‘cardboard house’. Reed’s comments come in response to a December 2 CNBC interview with Tether co-founder Reeve Collins. Collins went live representing his company following the FTX collapse. Addressing their conversation here, Reed suggests that the company runs a pyramid scheme:
Wow, tell us Tether runs a Ponzi scheme without telling us that Tether is running a Ponzi scheme. Just listen to their answers. In my opinion, as an 18-year former SEC enforcement officer, my avoidance/diversion/reaction makes me believe Tether is a house of cards.
Reed’s ‘card house’ meant Tether’s fragility. He reminded that even a big company like FTX was wiped out of the market in a week. cryptocoin.comAs you follow, FTX announced its bankruptcy on November 11, about a week later.
Tether rejects questions about reserves
What I can say is that for the last eight years of Tether’s operating history, each token has always been used for exactly $1. I sold the company at the end of 2015 and the principles, in my opinion, continued to work to their best and stood the test of time with the best risk reduction tactics in the industry.
Also, Collins acknowledged that the industry needs more transparency, considering recent events regarding FTX as well as BlockFi’s filing for bankruptcy:
These questions are okay and the industry as a whole will become increasingly transparent due to the recent failures of FTX, BlockFi and other companies. All this is really good for the progress of the industry.
John Reed made a ponzi statement in these altcoins
The focus of the cryptocurrency market was first shifted to Tether after the collapse of Terra. After the collapse of FTX, Reed began to criticize how the exchange was managed. Founder Sam Bankman-Fried has come under fire for alleged mismanagement of client funds. Reed recently noted that the FTX situation is worse than the notorious Bernie Madoff Ponzi scheme. At the same time, he called NFTs ‘a giant pyramid scheme’. According to the former enforcement attorney, NFTs are “more crypto crap.” The largest representatives of NFT coins, which the SEC official refers to, are as follows:
- Apecoin (APE)
- Flow (FLOW)
- Enjin Coin (ENJ)
- Decentraland (MANA)
- The Sandbox (SAND)
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