Tether Increases Treasury Bill Holdings, Cuts Commercial Paper

According to the company’s latest portfolio update, Tether has further reduced its commercial paper holdings and increased its treasury bill holdings. 

The reduction in the company’s commercial debt is in line with the firm’s plans outlined earlier in the year. 

Details Of The Transparency Report 

Tether’s CTO, Paulo Ardoino, shared details about the transparency report, announcing an increase of nearly 15% in commercial paper holdings since June 2022. The CTO further added that Tether’s transparency report would be further updated every 45 days, with the company working on reducing the time between reports. 

According to a report in June 2022, over 43% of Tether’s stablecoin reserves, valued at nearly $29 billion, consisted of Treasury Bills. In an update shared on Twitter on Monday, Ardoino stated that this figure has now increased to 58.1% as of September 2022, an increase of over 15%. He further added that the company’s commercial debt holdings had come down to less than $50 million. 

Tether’s Legal Challenges 

The latest revelations come against the backdrop of a U.S. District Court in New York ordering the company to provide financial details. According to the order, Tether was required to provide balance sheets, general ledgers, income, cash flow, and profit and loss statements as part of an ongoing class-action lawsuit against the stablecoin issuer. 

The lawsuit claimed that Tether, in collaboration with crypto exchange Bitfinex, manipulated the market to issue USDT, leading to an inflation in the price of Bitcoin. Tether was unfazed by the court order, issuing a statement and calling it a “routine discovery order.” Tether stated, 

“The order that was issued yesterday in the case captioned In Re Tether and Bitfinex Crypto Asset Litigation is a routine discovery order and does not in any way substantiate plaintiffs’ meritless claims. We had already agreed to produce documents sufficient to establish the reserves backing USDT, and this dispute merely concerned the scope of documents to be produced. As always, we look forward to dispensing with plaintiffs’ baseless lawsuit in due course.” 

Calls For Greater Transparency

Tether has been under pressure and scrutiny, with calls for greater transparency. The latest figures were released after the company announced that it would be releasing monthly attestation reports instead of the usual quarterly reports. 

Earlier in July, Paxos CEO Charles Cascarilla, speaking after Paxos Trust shared the reserve breakdown of its USDP stablecoin, called for greater transparency to restore users’ faith in stablecoins. Stablecoins play a critical role in the decentralized finance (DeFi) ecosystem, ensuring users have to face minimum volatility. 

Tether is currently the world’s largest stablecoin, having a market cap of $68 billion. USDC, the second largest stablecoin, has a market cap of around $47 billion.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.