Tether is facing severe allegations from Justin Bons, founder of Cyber Capital, who asserts that the company operates a scam larger than FTX and Bernie Madoff's Ponzi scheme. His accusations center around Tether's claimed $118 billion reserves and its ongoing lack of independent audits.

Critics argue that Tether is improperly holding and issuing USDT without verifiable proof of the underlying reserves. Bons highlights the pressing need for greater transparency and independent verification to restore confidence in the stablecoin.

This controversy adds to the growing skepticism around Tether's claims and operations, potentially impacting its reputation and the broader cryptocurrency market.