Stablecoin Issuer Tether Cuts Commercial Paper Holdings to Zero
The company has been gradually replacing its commercial paper holdings with U.S. Treasury bills.
Stablecoin issuer Tether has reduced its commercial paper holdings to zero, replacing those holdings with U.S. Treasury bills, the company announced in a blog post Thursday.
“Reducing commercial papers to zero demonstrates Tether’s commitment to backing its tokens with the most secure reserves in the market,” Tether wrote.
As of Sept. 30, the company's U.S. Treasury holdings stood at 58.1% of its total portfolio, up from 43.5% at the end of June, Tether Chief Technology Officer Paolo Ardoino tweeted earlier this month. In its latest post, Tether didn't specify what percentage of its current portfolio is held in U.S. Treasurys.
Commercial paper is short-term unsecured debt issued by companies, where the value of the paper depends on the issuing company. Commercial paper is less stable than other debt instruments, such as U.S. Treasury bonds.
Tether had said that it would bring its commercial paper holdings to zero by the end of the year because of growing concerns over the stability of the Tether ecosystem and its stablecoin, USDT.
Earlier this month, Tether said it had cut its commercial paper holdings to less than $50 million.
UPDATE (Oct. 13, 17:14 UTC): Added information from Tether CTO's tweet in third paragraph.
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.
Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Head to consensus.coindesk.com to register and buy your pass now.