Yeah, this is exactly the issue with Tether — they love throwing around the word audit when in reality it’s just quarterly attestations. Attestation = they show a snapshot of reserves based on numbers they themselves provide, and an accounting firm basically rubber-stamps it. That’s very different from a full GAAS audit where everything is independently verified from top to bottom.
The crazy part is that people in crypto hear “independent report” and automatically assume it means “audited”. Tether has been promising a real audit since like 2017 and it’s still “coming soon”. Meanwhile, they remain the biggest stablecoin in circulation.
At this point, I think most of us accept USDT is a black box. It works because the market believes it works. But if they ever had to open the books like a public company, we’d either see the truth (good or bad) or the whole thing would collapse. Until then, “attestation theater” is all we’re gonna get.
Tether is like a "timebomb" waiting to detonate at any moment. I hope it doesn't turn out into another disaster like Terra/LUNA's UST stablecoin. Investors will lose confidence/trust in collaterized stablecoins. At least, for a short period of time. Fortunately, regulators are paying attention towards the recent developments in the industry, so all hope is not lost. If investors are made whole after the crash, there should be nothing to worry about.
Be aware that if Tether falls, it will take down the whole crypto market with it. Top coins will suffer dearly (eg: Bitcoin, Ethereum, etc). Long-term speaking, things should return back to normal. I'd diversify my investment just to be safe.