Tether’s CTO, Paolo Ardoino, has identified a coordinated attack on USDT by traditional hedge funds shorting the stablecoin.
According to Mr. Ardoino, the attack involves a new wave of FUD, trolling, clowns, and more.
Mr. Ardoino has reiterated that Tether is 100% backed by reserves.
He also added that Tether is phasing out its reserve exposure of commercial paper in preference to US treasuries.
Tether’s and Bitfinex’s CTO, Paolo Ardoino, has identified a coordinated attack on USDT by traditional hedge funds shorting the stablecoin. The Tether CTO points out, through a twelve-part Twitter thread that can be found below, that the attacks involve a new wave of FUD, troll armies, clowns, and more.
1/ I have been open about the attempts from some hedge funds that were trying to cause further panic on the market after TERRA/LUNA collapse. It really seemed from the beginning a coordinated attack, with a new wave of FUD, troll armies, clowns etc. https://t.co/hhcsgHV1Ow
Traditional Hedge Funds are Betting Against Tether – Wall Street Journal.
Mr. Ardoino was responding to a Wall Street Journal report pointing out that the aforementioned hedge funds ‘have been ramping up their bets against Tether’ through Genesis Global Trading Inc., one of the largest crypto brokerages for professional investors.
The Wall Street Journal Report explains that the short sellers have been betting against Tether for the last 12 months, with their interest increasing after TeraUSD’s (UST) collapse. The same short sellers believe that ‘tether’s commercial-paper holdings are backed by debt-ridden Chinese property developers.’
USDT is 100% Backed – Tether CTO.
It is with this background that Tether’s CTO has pointed out in the Twitter thread that the same hedge funds believe Tether is not 100% backed, that its had exposure to Evergrande and that it has 85% exposure to Chinese commercial paper.
Furthermore, Mr. Ardoino stated that the hedge funds also believe Tether is ‘issued from thin air’ and that ‘lenders were borrowing from Tether without over-collateralization.’
Mr. Ardoino reiterates that the USDT was 100% backed and Tether has remained transparent over the years. The company plans to phase out its reserves in the form of commercial paper and replace them entirely with US Treasuries. He said:
Despite all the public 3rd party attestations, our collaboration with regulators, our increased transparency efforts, our commitment to phase out CP exposure and move into US Treasuries, our settlements, … they kept thinking and suggesting that we, Tether, are the bad guys.
But as we always said, Tether had/has in fact >= 100% of the backing, never failed a redemption and all USDt are redeemed at 1$.
Tether Has Continually Honored Redemptions of USDT to USD
Tether’s CTO also highlighted that the company continues to honor redemptions of USDT into USD even during the toughest of times in the crypto markets. He said:
In 48 hours Tether processed 7B in redemptions, averaging 10% of our total assets, something almost impossible even for banking institutions.
In more than one month Tether processed 16B in redemptions (~19% of our total reserves), again proving that our operations, portfolio, banking infrastructure and team are solid and battle tested.