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The largest stablecoin-issuer Tether faced a raid of investors who want to cash out their investments in USDT
The issuing company of USDT’s largest stablecoin by market capitalization, Tether, has paid investors $10 billion since early May. This is written by The Guardian with reference to on-chain data. It is reported that only on Saturday, May 21, about $ 1 billion was converted from USDT Three days earlier, investors also cashed out another $ 1.5 billion.
As of the end of March, Tether provided deposits in the stablecoin by investing in a mixture of US Treasury bills, bonds of other private companies and about $ 5 billion in various “other investments”, including other cryptocurrency enterprises.
Tether holds about $20 billion in cash in commercial paper, $7 billion in money market funds and nearly $40 billion in U.S. Treasury bills. Another $7 billion is held in “corporate bonds, funds and precious metals” and “other investments (including tokens).”
However, Patrick McKenzie, a fintech columnist at Stripe, fears that the company may not agree on its intentions on stablecoin reserves. For example, as Mackenzie notes, the volume of reserves is already $ 162 million more than the total number of USDT issued by the company, McKenzie notes.
“Tether has invested $62.8 million in reserves in the Celsius Network … Celsius is in free fall due to the current market situation; the value of their native token has dropped by more than 86%,” McKenzie said.
The depreciation of Celsius could have cost more than $20 million, he added. GTether CTO Paolo Ardoino claims that USDT was able to prove its stability, since it has never missed out on requests to cash out investments from trusted clients.
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