Read the report you linked to.

Among other things: -Tether promises on that page to publish reserves daily. The last accounting report is Sept 30, 2023 -That report specifically notes two ongoing lawsuits, the outcome of which is not included in the audit results (because they’re still going) -The audit report shows $56B in cash & equivalent reserves against $67B in Tether liabilities…I.e. they’re about $11B short of actually backing their token. The balance is made from bonds & precious metals (probably fine), and outstanding loans (definitely not fine…the recoverability of those loans is unknown). Most believe that those loans are actually to their parent company, which means they’re not real at all, they’re just shell game accounting. That’s what they’re trying to determine in the lawsuits and, so far, Tether has not responded to.

Short version: their own auditor’s report says they don’t have the cash they claim to and the auditors can’t tell, and Tether isn’t saying, where the balance is actually coming from. It’s definitely not cash and it may not exist. If it did, the lawsuits would be over quickly. The fact that they aren’t tells you something.

Edit: I dig into the footnotes.., it looks like they’re double counting the gold they have to back Tether Gold tokens as precious metal reserves for Tether. Which means their precious metal reserve that’s backing Tether also really isn’t…it can back Tether Gold or Tether but not both. So the gap is closer to $11B than the audit report summary makes it seem.