Tether CTO Paolo Ardoino predicts the company will generate about $700 million in profits for the first quarter of 2023, which would bring the company’s surplus in reserves to $1.6 billion. A record, partly due to the few problems encountered by its rival Circle following the collapse of Silicon Valley Bank.
Tether, big winner of the banking crisis
Paolo Ardoino, CTO of Tetherprovides that the company generates approximately $700 million in profits for this first quarter of the year 2023. In other words, if Tether managed to reach this figure, which is the same as that recorded for the last quarter of the year 2022, the issuing company of the USDT would see a surplus of $1.6 billion in its reserves.
Due in particular to the setbacks encountered by its main competitor Circle, the company issuing the USDC stablecoin, whose peg to the dollar was temporarily lost on the weekend of March 11. Since most investors have not forgotten the difficulties encountered by Terra’s UST, the latter thus turned to the USDT.
This transfer of values is also clearly observable on the graph below:
Figure 1 – Evolution of the market capitalization of USDT (in purple) and USDC (in blue)
According to Bloomberg, Paolo Ardoino reportedly said that most of Tether’s reserves were now invested in short-term US Treasuriessome time after the company decided to ditch commercial paper, an effectively riskier investment.
Thus, after having suffered a certain mistrust from investors for several years due to a lack of transparency vis-à-vis the management of its reserves, Tether seems to be emerging as the big winner from this crisis. Moreover, the company had also opted for a monthly audit of its reserves last summerthus abandoning the quarterly audit that it used until now.
Tether’s CTO also ended his statement by drawing the parallel between Tether and the ongoing banking crisis:
“First of all, seriously, after the bankruptcy of Credit Suisse and all the other banks, you are interested in Tether again? Tether makes money and banks go bankrupt. If you need to put money somewhere, I think Tether is the safest of all the choices. »
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Sources: Bloomberg, DefiLlama
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