Tether Up On US Treasury Bills, Reduces Commercial Paper Holding

The accounting firm BDO Italia has performed a quarterly assurance on the Consolidated Reserves of Tether Holdings Limited and its wholly-owned subsidiaries as of 30th September 2022. According to its report, Tether Group’s consolidated assets exceed its consolidated liabilities.

As per the Consolidated Reserves Report (CRR), Tether Group’s total assets, as of September 30, 2022, amounted to US$ US$68.1 billion, up from US$66.4 billion as of June 30, 2022. According to the same report, Tether Group’s consolidated total liabilities amounted to US$67.8 billion, up from US$66.3 billion as of June 30, 2022.

The report also shows that Tether’s Cash & bank deposits, consisting of cash deposits at financial institutions and call deposits, rose from US$ 5.4 billion as of June 30, 2022, to US$ 6.1 billion as of September 30, 2022. The CRR shows that Tether Group’s stock of U.S. Treasury Bills rose from US$ 28.9 billion as of June 30, 2022, to US$39.7 billion as of September 30, 2022.

Worth noting is that Tether Group’s holding of Commercial Paper and Certificates of Deposit dropped from US$8.4 billion as of June 30, 2022, to US$0.05 billion as of September 30, 2022. Tether’s stock of commercial paper and certificates of deposit has been a cause for concern for some analysts.

The recent liquidity crunch at FTX has rocked the crypto markets. The backing further exacerbated this out of Binance Exchange from a proposed acquisition of FTX.  Bitcoin price plummeted from just over US$20,000 at the start of November 2022 to a low of US$15,742 on November 10, 2022, according to CoinGecko data. 

According to the US Bureau of Labour Statistics (BLS), the all items Consumer Price Index (CPI) increased by 7.7% before seasonal adjustment for the 12 months ending October 2022. This has been the smallest 12-month increase since the period ending January 2022. The markets soared on the latest US inflation report, and treasury yields tumbled. Bitcoin has recovered slightly and is trading at just below US$ 17,000.

In the aftermath of the FTX debacle, Binance Exchange released proof of assets of their crypto holdings to reassure customers and the broader crypto markets that they are not experiencing liquidity issues. Tether has continued its commitment to transparency through regular quarterly assurance opinions.

The recent shock events in the crypto markets have left investors needing greater assurance. Proof of asset reserves for crypto companies is likely to be more regular going forwards, and so are the calls for faster regulation of the crypto markets.