Tether issuer disclosed the composition of its reserves for the first time
“Other investments and investments in cryptocurrencies” accounted for just 1.64% of Tether reserves.
Tether Holdings Limited, the company that issues steblecoins of the same name, for the first time published information on what it holds in its reserves as of the last available reporting date (March 31, 2021). From the information provided, 75.85% of the reserves represent a broad group of assets, from cash and cash equivalents to short-term deposits and short-term promissory notes.
The remaining 24% represent collateralized loans (12.55%), fund units, other bonds and precious metals (9.96%). Finally, the “Other investments, as well as investments in cryptocurrencies” line accounted for just 1.64% of Tether’s reserves. The company claims that cryptocurrency investments are 100% bitcoins only.
Of the first broad group of reserves, which accounted for 75.85% of such Tether resources, most (65.39%) are short-term bills of other issuers. Fiduciary deposits and notes issued on redemption terms yielded another 24.2% and 3.6%, respectively. Finally, cash itself accounted for only 3.87%, and highly liquid U.S. Treasury bonds accounted for only 2.94% of reserves.
Tether’s emerging reserves data suggests that the company, whose staplecoins play a major role in the development of the cryptocurrency market and bitcoin in particular, itself invests a very small portion of its assets in digital assets, and does not clearly define that percentage, which is less than 1.64% in any case. At the same time, Tether does not clarify who the organization is lending to by buying short-term promissory notes.
Currently, all of Tether’s stackablecoins amount to about $57.75 billion, of which $30 billion of digital assets are issued based on the Tron blockchain and the remaining $27.75 billion is based on Ethereum, as well as a number of other distributed ledgers. As a reminder, a Wall Street trader with 40 years of experience has previously refuted speculation that Tether issuance is a key driver of bitcoin price growth.
