Tether's Big Numbers and the Doubters
Stablecoin USDt's Rating Questioned
Tether, the company behind the popular stablecoin USDt, is under scrutiny from S&P Global, which downgraded USDt's ability to maintain its peg to the US dollar, calling it "weak."
Tether's CEO Disagrees
Paolo Ardoino, Tether's CEO, disputes the downgrade, arguing that S&P didn't account for all of Tether's assets. At the end of Q3 2023, Tether held approximately $215 billion in assets, exceeding the $184.5 billion owed in stablecoins. Additionally, the company has extra cash and profits from US Treasury bonds.
The Missing Numbers
Ardoino highlights that S&P overlooked key figures, including:
- $7 billion in extra cash
- $23 billion in profits
- $500 million monthly earnings from US Treasury bonds
Analysts Weigh In
Not everyone agrees with Tether's stance. Arthur Hayes from BitMEX suggests Tether may be investing in gold and Bitcoin to compensate for lower interest rates, posing a risk if those assets drop by 30%.
However, Joseph Ayoub, a former Citi analyst, disagrees. He claims Tether has more money than reported and generates significant interest with a small workforce, even suggesting they are safer than traditional banks.
The Bigger Picture
Tether remains a major player in the crypto market, far more than just a stablecoin. With such large figures at play, the debate over its financial health is sure to continue.
