Tether, the issuer of USDT, released its first quarterly report for 2023, revealing record excess reserves of $2.44 billion. The company also shared the breakdown of its reserves into cash, short-term deposits, Bitcoin (BTC), and gold. Tether maintains its dominant position in the stablecoin market, with a market capitalization of $82.87 billion, but some still have doubts about its transparency.
Tether publishes its first quarterly report
Tether, the USDT issuing companythe largest stablecoin in the ecosystem by market capitalization ahead of Circle’s USDC, has just released its first quarterly report on its reserves for the start of 2023.
The report was produced by BDO Italia, the Italian branch of BDO, the fifth largest audit firm in the world behind the Big Four. According to Tether’s press release, its reserves have never been greater, with an “all-time high” of $2.44 billion in excess.
According to the USDT issuer, charged through this report with demonstrating its ability to ensure the liquidity of its stablecoin, the majority of its reserves are now held in cash or cash equivalent, or in short-term deposits.
Also, for the first time, the company also revealed the share of Bitcoin (BTC) and gold in its reserveswhich amount respectively to 1.5 billion (2% of the total) and 3.4 billion dollars (4% of the total).
An initiative which, according to Paolo Ardoino, the CTO of Tether, aims to increase the transparency of its reserves:
“We have an extremely positive outlook and remain committed to transparency, which is why we have introduced new categories in the reserves breakdown in our quarterly report to provide even more transparency to our users. »
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A former SEC is stepping up to the plate
John Reed Stark, a former Securities and Exchange Commission (SEC) official from the United States, made a – long – noticed tweet, in which he claims that Tether could be “ the next domino to fall » :
IMHO, Tether is a Mammoth House of Cards.
Having studied markets and financial statements for 35 years, including during my 18 years as an attorney in the SEC Enforcement Division, IMHO, Tether, could be the next domino to fall. https://t.co/38SFD2fsRk
Tether, the first… pic.twitter.com/fOy3pzImbS
—John Reed Stark (@JohnReedStark) May 9, 2023
According to him, the current American regulatory framework does not allow a stablecoin issuing company like Tether to prove its true transparency as this activity has no auditing or reporting requirements.
“Tether’s core business, the essence of everything Tether does, is tied exclusively to Tether’s financial reserves. Yet these reservations remain unaudited, unconfirmed, and therefore dubious, leaving Tether customers to grapple with the remarkably condescending and ineffective blah-blah, hype, and bluster of Tether’s public relations. »
To go further, he emphasizes the difference between the report here published by Tether and a real audit :
“In any event, an attestation is not the same as an audit – and this type of ‘unverified snapshot’ would never pass any regulatory test. »
Anyway, since the passing depeg of its main rival stablecoin, namely USDC, Tether is only gaining more market share.
Evolution of the market capitalization of USDT (in green) and USDC (in blue)
The market capitalization of USDT is currently valued at $82.87 billion, which earned it a 63.55% market share dominance over stablecoins.
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Maximilien Prue
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