Skip to main content

Insight into the composition of Tether USDT reserves



On Thursday, Tether published a chart showing the allocation of the USDT stablecoin reserves. It reveals part of the truth, but not the whole truth.

For a long time, there have been concerns as to whether all deposits of the stablecoin Tether (USDT) are actually covered by the US dollar. Now, for the first time, Tether provides some kind of insight into this matter. As a reminder: USDT is the largest cryptocurrency linked to the US dollar.


On Thursday, the company released a chart showing the breakdown of reserves. It is dated March 31, 2021. It shows that Tether held nearly 76 percent of its reserves in the form of cash and other short-term deposits and commercial paper. The latter make up 65 percent of this. However, it remains open which company the Commercial Pacers come from. However, the numbers have not been cross-checked by an independent auditing company, so they should be treated with caution for the time being. Although there are two reports by the Caribbean chartered accountant Moore Cayman this year. They certified that Tether had full coverage. However, it is not explicitly stated in the reports how USDT is supposed to be fully hedged.

Well, one can argue that other stablecoin issuers like Circle and Gemini don't provide this information either. As a rule, they don't even provide their own breakdown of the reserve composition of their tokens. At Gemini, for example, it says succinctly that customers' reserves are either held in accounts with the FDIC deposit insurance fund or a Goldman Sachs fund that invests exclusively in US government bonds. However, unlike Tether, there was never any doubt about this depiction. 

Tether fulfills its obligation with the publication

The new composition report is part of Tether's effort to adhere to a settlement that is part of an agreement with the New York Attorney General (NYAG). The public prosecutor's office had previously investigated Tether and its sister crypto exchange Bitfinex for covering up losses of around $ 800 million. Bitfinex and Tether then paid a fine of $ 18.5 million. They agreed to publish quarterly breakdowns of their reserves as part of the settlement. 

We pledged to make this information available to both the Attorney General and the public. Today's release reflects our ongoing commitment to transparency

said Tether General Counsel Stuart Hoegner in a statement attached to the diagram.

Traders primarily use Tether to quickly transfer dollar values ​​between exchanges. This allows you to take advantage of arbitrage when a bank transfer is not available or simply too slow.


Comments

Post a Comment

Popular posts from this blog

Cardano price forecast – price breaks out! Are we near $1.5 soon?

 In our last Cardano price prediction , we wrote that the price could break out soon. The reason for this was a symmetrical triangle. This triangle was performed after the crash, so we expected the price to break down. But now the course has broken out of the triangle in a bullish manner. But how far could the course rise or what is the goal? Today we will explain to you about the Cardano course ! Cardano price broke out of the triangle and was able to rally to the $1.19 resistance. We tested this resistance, and a short time later the price was sold off. The triangle's target was around $1.23, so we now believe the price has completed the target. As a result, we no longer expect a further increase. Instead, the price could now descend and possibly form new lows. If the price breaks the $1.19 resistance, the price could rally to around $1.5. There is the next resistance where the Cardano price could bounce. If Cardano price fails to break the $1.19 resistance, we would expect the p...
Post a Comment
Read more

Tesla Beats Sales Expectations - Bitcoin Holdings Remain Flat

  The car manufacturer presented its report for the fourth quarter on Wednesday evening. Tesla exceeded expectations for sales and profits. Bitcoin holdings, meanwhile, remain unchanged. Tesla (TSLA) published the Q4 report for 2021 last night. Overall, the electric car maker recorded a sales increase of 65 percent in this quarter compared to the previous year. In the automotive sector alone, sales rose to 15.97 billion US dollars. In addition, the US company set a new record profit of 5.5 billion US dollars - an increase of 665 percent over the previous year. Analysts previously expected adjusted earnings of $2.36 per Tesla share. With 2.54, the carmaker was able to significantly exceed this value - with positive effects on the TSLA course, which recorded an increase of almost 4 percent. Tesla's bitcoin holdings, meanwhile, remained unchanged. At the end of the fourth quarter, the value remained stable compared to the previous quarter at $1.26 billion. In February 2021, Elon Musk...
Post a Comment
Read more

Cardano founder doubts Bitcoin's future as world reserve currency

  Cardano's founder doesn't believe Bitcoin has what it takes to become the world's leading currency. Charles Hoskinson stated in a recent interview that he didn't think Bitcoin would become the world reserve currency. According to the founder of Cardano, a cryptocurrency with smart contract features would become the global reserve currency. Hoskinson believes Cardano or Ethereum would become the world reserve currency. A global reserve currency must offer services like smart contracts, metadata standards, and improved throughput that complete enormous transactions per second. According to the Cardano founder , the scarcity of Bitcoin is due to the high cost of production: "If you make paintings, one of which you have to paint by hand and the other by machine, and both look the same and the demand for both is the same, then the effort for one is a thousand times greater than for the other." Hoskinson spoke about Bitcoin's massive energy consumption, addin...
Post a Comment
Read more