Tether anticipates reducing the backing of USDT with commercial paper to $8.4 billion by the end of June 2022, and ultimately eliminating it entirely.
Tether, the largest stablecoin firm, intends to ultimately eliminate the commercial paper backing for its dollar-based stablecoin Tether (USDT).
Wednesday, Tether made an official statement denying claims that its commercial paper portfolio is backed by Chinese or Asian commercial papers to the tune of 85 percent and is being sold at a 30 percent discount.
These charges were deemed “absolutely incorrect” by the stablecoin company, which reiterated that more than 47 percent of total USDT reserves are now “United States Treasuries.” According to Tether’s most recent assurance opinion, released in May, commercial paper accounts for less than 25 percent of USDT’s backing, or around $21 billion as of March 31.
The breakdown of the underpinning assets for USDT. May 2022’s publication of Tether’s assurance opinion is the source
Tether’s current portfolio of commercial paper has decreased to $11 billion, according to its most recent statement. The company aims to further lower it to $8.4 billion by the end of June 2022, with the ultimate goal of eliminating its commercial paper underpinning, according to the statement.
“This will decline gradually to zero without incurring any losses. All maturing commercial papers will be converted into U.S. Treasuries having a short maturity.
Tether also reiterated the current problem of the Celsius loan platform, saying that its stake in Celsius has been liquidated with no damage. “Tether has no exposure to Celsius other than a tiny investment of Tether shares in the business,” the company said.
Additionally, Tether said that claims that it has a lending exposure to the cryptocurrency venture capital company Three Arrows Capital are “categorically untrue.”