Tether to reduce secured loans to zero by 2023
Tether (USDT) said it would remove its secured loans in its reserves by 2023, according to a Dec. 13 blog post.
A Dec. 1 Wall Street Journal report said Tether’s secured loan was 9% (roughly $6.1 billion) of its total assets as of Sept. 30. The report added that the stablecoin issuer might not have enough liquid assets to pay redemptions if there was a crisis because of these loans.
However, Tether countered this claim, saying the “secured loans held in its reserves are overcollateralized and covered by extremely liquid assets.”
“Tether is professionally and conservatively managed and this will be demonstrated once again by successfully winding down the lending business without losses (since all loans are over-collateralized by liquid assets). “
Meanwhile, Tether said it would continue to show resilience even in the face of uncertainty regardless of mainstream media’s click-bait headlines, story fabrications, and concocted disinformation.
Tether had cut its commercial paper to zero in October following pressure from the community about the quality of these reserves.
Tether’s USDT is the largest stablecoin by market cap. The fiat-backed stablecoin accounts for roughly 75% of stablecoin’s trading volume, according to CryptoSlate data.
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