Summary:
- The USDT issuer reiterated that its token reserves are backed by assets in the U.S. Treasury and a declining amount of commercial paper.
- Tether announced its move to reduce commercial paper holdings to zero earlier in the year.
- The stablecoin issuer also disclosed that the company has no exposure to Celsius and its previous position was liquidated with no losses.
- Rumors about exposure to Three Arrows Capital are also forced, per the official statement.
Tether, the issuer of the largest stablecoin in crypto USDT, released an announcement on Wednesday addressing rumors regarding its reserves. The statement provides further clarity on the company’s commercial paper holdings for its centralized stablecoin.
USDT is the top crypto stablecoin with a market cap of over $70 billion. The token is backed by a mix of cash reserves in banks, short-term corporate debts, and the U.S. Treasury Bills as confirmed by Tether’s CTO, Paolo Ardoino.
Reports emerged over the past few days claiming that the digital asset firm has about 85% of its commercial paper portfolio backed by Asian commercial paper trading at a 30% discount. The company insists that these claims are false and merely designed to incite more panic amid uncertain market conditions.
The blog post verifies that the USDT issuer has 47% of its total token reserves in U.S. Treasury Bills. Also, commercial paper holdings have reduced to 25% of USDT’s portfolio in line with Tether’s strategy to reduce short-term debts, as EthereumWorldNews reported back in April.
CTO Ardoino has said before that the firm plans to bring commercial paper holdings to zero.
Tether’s Celsius Position Liquidated With Zero Losses
The stablecoin issuer also disclosed that its position with the lending platform Celsius was liquidated with no loss. According to the blog post, the company only has a small equity investment and has no other exposure to Celsius.
Regarding Three Arrows Capital, the statement denied any level of exposure to the service.
Tether is aware of other rumors being spread, suggesting that it has lending exposure to Three Arrows Capital – again this is categorically false.