Stablecoin Issuer Tether Reports $700M Profit, Complete Exit From Commercial Paper
Tether's assets as of Dec. 31 stood at $67 billion with liabilities of $66 billion, almost all of which relates to digital tokens issued.
:format(jpg)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/YAL4FFDFI5EM5EBFHVJ56LI7T4.jpg)
(Shutterstock)
/arc-photo-coindesk/arc2-prod/public/LXF2COBSKBCNHNRE3WTK2BZ7GE.png)
Tether, issuer of the world's largest stablecoin, reported a $700 million fourth-quarter profit and said it completely moved away from holding commercial paper as part of the reserves backing its USDT token.
The majority of its holdings ($39.2 billion) were in U.S. Treasury bills as of Dec. 31, according to an attestation from BDO. The rest of its $67 billion of assets were distributed across money market funds, cash and other items. Secured loans were reduced by $300 million, in line with a plan to reduce them to zero this year.
Tether had set a goal for eliminating commercial paper – a type of short-term, unsecured debt – by the end of 2022, which it met.
The quality of the holdings backing stablecoins came under greater scrutiny last year following the collapse of algorithmic stablecoin terraUSD (UST), which had a market capitalization of $18 billion prior to its downfall. Tether first published a breakdown of its reserves in May 2021, revealing that 49% of its assets were backed by commercial paper. Subsequent attestation reports showed a gradual decline in the proportion of commercial paper on Tether's books.
In September, the company was ordered by a U.S. judge to produce records relating to USDT's backing during a lawsuit that alleged Tether conspired to issue the stablecoin as part of a campaign to inflate the price of bitcoin (BTC).
UPDATE (Feb. 9, 2023 12:39 UTC) : Adds commercial paper holdings to first paragraph, background on stablecoin scrutiny in second, further details starting in third.
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 an award-winning media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. In November 2023, CoinDesk was acquired by Bullish group, owner of Bullish, a regulated, institutional digital assets exchange. Bullish group is majority owned by Block.one; both groups have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary, and an editorial committee, chaired by a former editor-in-chief of The Wall Street Journal, is being formed to support journalistic integrity.
Learn more about Consensus 2024, 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.