Tether Cut Commercial Paper Reserve by 17% in Q1, Accountants Say

The reduction has continued with a further 20% cut since April 1, which will be reflected in the Q2 report, the stablecoin issuer said.

AccessTimeIconMay 19, 2022 at 2:49 p.m. UTC
Updated May 20, 2022 at 9:16 p.m. UTC

Jamie Crawley is a CoinDesk news reporter based in London.

Tether reduced its commercial paper holdings by 17% from $24.2 billion to $20.1 billion in the first quarter, according to its latest attestation report.

The majority of this $20.1 billion (around $18 billion) is comprised of A-1 and A-2 paper, which qualify as investment grade, according to the report. A list of ratings agencies grading the commercial paper wasn't specified other than, "Standard & Poor’s ratings, or equivalent ratings by Moody’s, Fitch or other nationally recognized statistical rating organizations" in the footnotes. The geographic location of the commercial paper issuers was also not found in the report.

The reduction in commercial paper has continued with a further 20% cut since April 1, which will be reflected in the second-quarter report, Tether announced Thursday. On June 30, 2021, commercial paper and certificates of deposit totaled $30.8 billion, or 49% of Tether's assets at that time.

Tether has also slightly reduced its cash deposits from $4.2 billion to $4.1 billion and increased its U.S. Treasury bond holdings from $34.5 billion to $39.2 billion since its last report.

The latest report also revealed that $286 million of its assets were held in foreign government bonds with a maturity of less than 180 days. In Tether's previous report, through the end of last December, there was no mention of holdings of any non U.S. government bonds, according to Barron's.

The "other investments" category, which includes digital tokens, has remained consistent, falling slightly from $5.02 billion to $4.96 billion. This area has been thought of as the most troubling aspect of the attestation reports because of uncertainty about what exactly these assets are, which Tether doesn't disclose.

Furthermore, the report does not account for the recent pullback in crypto markets witnessed since early May.

Tether's attestation report is authorized by accounting firm MHA Cayman. As part of a settlement with the New York attorney general in February 2021, Tether must release quarterly attestations of its assets and liabilities in order to be more transparent when it comes to what exactly backs its tether (USDT) stablecoin.

Tether now has a total of $82.4 billion in assets, up from $78.7 billion on Dec. 31.

UPDATE (May 19, 15:45 UTC): Added more details.

UPDATE (May 20, 21:16 UTC): Added details about Tether's holdings of foreign government bonds in fifth paragraph.

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

CoinDesk - Unknown

Jamie Crawley is a CoinDesk news reporter based in London.

CoinDesk - Unknown

Jamie Crawley is a CoinDesk news reporter based in London.

Trending

1
CoinDesk - Unknown
Voyager Seeks Bankruptcy Protection Amid Crypto Credit Crisis

The Toronto-based lender filed for Chapter 11 bankruptcy in New York late Tuesday.

CoinDesk - Unknown
2
CoinDesk - Unknown
Binance Resumes Local Currency Deposits with Brazilian Payment System Pix

Withdrawals should be resumed “shortly,” said the company, which had suspended that feature on June 17.

CoinDesk - Unknown
3
CoinDesk - Unknown
Celsius Repays $183M on DeFi Exchange Maker, Gets Back Collateral, Blockchain Data Shows

The troubled crypto lender paid down $183 million of its debt to the decentralized exchange Maker, blockchain data shows, possibly in a bid to recover bitcoin-linked collateral that otherwise would remain trapped.

CoinDesk - Unknown
4
CoinDesk - Unknown
First Mover Asia: Crypto Game Consoles Aren’t Needed as Web3 Gaming Has Workers, Not Gamers; Bitcoin Dips, Then Regains Its Perch Above $20K

Studios are raising significant amounts of capital, but they must build games that do a better job of engaging users; ether and most other major cryptos rise.

CoinDesk - Unknown