Tether's $3.3 Billion Liquidity Cushion Ensures Stability and Trust
Summary:
Tether maintains a liquidity cushion of $3.3 billion, ensuring stability and trust in its ecosystem. The transparency report confirms reserves backing over 100% of the total assets of $86.1 billion. Tether discontinues support for Bitcoin OmniLayer, Bitcoin Cash, and Kusama blockchains while redemptions remain available.
Tether, the stablecoin issuer, has a liquidity cushion of approximately $3.3 billion to ensure stability and build trust among shareholders. According to Tether's reserves report as of August 24, the surplus in shareholder capital cushion amounts to $3.29 billion across various blockchain ecosystems. With the exception of Algorand and Polygon, Tether has the authority to issue USDT tokens in the millions. The Solana ecosystem leads in terms of pre-authorized value for issuance, with $1.57 billion, followed by Ethereum with $617 million and Tron with $353 million. Tether has not yet commented on the significance of preauthorization for transparency and trust. The total assets under Tether are $86.1 billion, with liabilities amounting to $82.8 billion, confirming a reserve backing of over 100%. However, other stablecoins under Tether, such as XAUT, EURT, MXNT, and CNHT, do not have the same liquidity cushion as USDT. Tether's transparency report contradicts concerns about its liquidity and asset backing. In October 2021, Tether was fined $41 million by the Commodity Futures Trading Commission for misleading statements about its reserves. Tether recently announced the discontinuation of support for the Bitcoin OmniLayer, Bitcoin Cash, and Kusama blockchains, although redemptions will still be available. The OmniLayer team faced challenges due to the lack of popular tokens and the availability of USDT on other blockchains. Tether is open to reissuing the Omni Layer version if there is an increase in its usage.
Published At
8/25/2023 8:17:30 AM
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