What “snapshots”? All transactions are visible on the chain. I don’t get how that is supposed to help. Could as well just use Photoshop?

They rely on 3rd party attestations where an audit firm verifies that when eg Tether says they have $100 cash, 1 btc and 1 eth, they actually do. The issue comes when these “point-in-time attestations” are gamed by eg taking a 1-day loan the day before the statements are sent so that the cash balance qualifies.

That would never fly with a real audit. You’d perform a triple tie out and the incoming cash transaction would have to be recorded. And you never do a single day.

Probably why very few of these organizations do real audits.

The audit documents make clear they are point-in-time.

I'm sure if they could do an audit for a full year/quarter, they would. But they didn't, so they can't.

They can. Anyone that won’t should be shut down immediately.