$7 billion has been removed from USDT as investors fear that Tether may go the way of UST
As reported by CNBC, the supply of USDT stablecoins issued by Tether has fallen from $83 billion to just under $76 billion since last week.
While investors fear that they may lose their money, just like with UST, the Tether CTO assures that the stablecoin is fully backed.
They have the cash to redeem any amount of Tether, tweeted Paolo Ardoino.
$7 billion removed from USDT
Last week, when USDT dropped below $1 for a short time, some investors hastily withdrew $7 billion from Tether as questions again arose as to whether the most popular stablecoin is 100% backed.
The price fell to $0.95 after the collapse of the Terra-powered algorithmic stablecoin chain UST, which has been shut down for some time now.
Tether, as it turned out after a settlement with the New York attorney general, is backed not only with USD in banks, but short-term commercial papers have also been used as collateral for the stablecoin.
Now that UST has lost its peg and $7 billion has been withdrawn from Tether, fears that USDT is not fully backed are rising again. When Tether last revealed what the stablecoin was based on, it turned out to be just $4.2 billion in cash, with the rest being unidentified treasury bills (34, $5 billion) and commercial paper ($24.2 billion).
After several calls for a complete audit of USDT reserves, in 2021, Tether promised CNBC to produce such an audit within several months, but it has not been done yet.
Tether is fully supported: Paolo Ardoino
Tether and Bitfinex exchange CTO Paolo Ardoino responded to a tweet from CryptoQuant CEO Ki Young Ju.
The head of the on-chain data platform wondered when an audit of Tether’s reserves would occur and be published so the crypto community can find out if $75 billion of USDT has full backing behind it.
Ardoino tweeted in response to this, saying few financial institutions would be able to do what Tether did: trade $7 billion in just 48 hours. He said the company could continue to buy back more USDT if investors want to withdraw it because Tether has all the cash to pay for investments and stressed that USDT is indeed fully backed.
