I don't trust Tether at the moment at least. It could be totally legit, but we all know how power corrupts. Seems eerily similar to the first banks giving out bank notes in exchange for storing your gold. If everything was done by the book so to speak then the system basically works. As soon as the system becomes corrupt and more bank notes (Tether) are given out than exists in reserves as gold (dollars) then the system falls apart.

Now with that said, I don't understand what's so complicated about an audit here. There's only really two numbers that need to be figured... one being how many tether in circulation, and two how many dollars in reserve. These dollars should be in a bank account somewhere so why is it so complicated to add up?

Here's a thought... what if there books are sooo convoluted specifically to hide something? What if there selling Tether for dollars, but at the same time using the reserve dollars to further manipulate and pump Bitcoin? This could explain how they are growing the supply of Tether so much while also "technically" still having enough dollars in reserve. Maybe those dollars just happen to be in the form of BTC at times. As long as they do this successfully then everything's still all good more or less for the average consumer using Tether, however if they loose their asses, or decide to take off with all the BTC then people holding Tether are screwed.

Would this cripple BTC? I don't think so. I think it would hurt it a bit in the short term, but if tether only accounts for roughly $2 billion I don't see it possibly being able to cripple BTC. Tether definitely, because that's what's on the line here... not BTC.