Tether Improves Quality Of Reserves According To Assurance Report
Stablecoin issuer Tether has reduced its commercial paper holdings in Q1 2022 to improve the quality of its reserves.
According to Tether’s report it reduced its commercial paper holdings to $19.9 billion from $24.2 billion the previous quarter, which represents a 17% decrease. It has also increased U.S. Treasury bills holdings from $34.5 billion to $39.2 billion.
Tether’s consolidated assets as per the report, stand at $82,424,821,101 and its consolidated liabilities at $82,262,430,079, $82,188,190,813 of which related to USDT issued.
Commenting on the report, Tether’s Chief Technology Officer Paolo Ardoino said:
“This latest attestation further highlights that Tether is fully backed and that the composition of its reserves is strong, conservative, and liquid. As promised, it demonstrates a commitment by the company to reduce its commercial paper investments and in doing so, led to a rise in its holdings in U.S. Treasury Bills.”
Tether added that it has plans to cut the commercial paper holdings by another 20%, which would be shown in its Q2 report.
According to a Bloomberg report from last October, much of Tether’s commercial paper had been issued by big Chinese companies, causing some analysts to question the quality of the reserves. Tether has not disclosed the names of the firms.
Tether is the provider of USD Tether (USDT), the biggest stablecoin in the crypto market. It maintains the value of its centralized stablecoin by using a basket of assets, including corporate debt, US Treasury bills and some cash reserves.
Tether had some difficulty dealing with investor concerns over the recent TerraUST collapse. During the last week, USDT’s market cap dropped by about $9 billion amid a spike in redemptions of USDT for dollars. Still, on May 12 the company tweeted that it would honor all redemptions as proof of its solvency.
Tether Continues to Honour All Redemptions from Verified Customers During Market Volatility, On Track To Process 2bn Today https://t.co/p1AugHb9Gn
