Tether Has Just Addressed Issue on Commercial Paper Holdings

Tether has been making headlines for a while now due to all kinds of moves that the team behind the project has been making. Check out the latest reports about the project below.

Tether, which is the largest stablecoin issuer in the world, is addressing the fact that at one point in the past, the firm held Chinese securities.

The firm’s disclosures were recently revealed as part of the settlement deal with the New York Attorney General (NYAG). The NYAG had accused Tether of irresponsibly backing the reserves of its stablecoin USDT, among other allegations. There have been rumors about Tether’s exposure to Chinese securities, but the company has clarified that its holdings were primarily in the banking sector and have always been liquid and from reputable companies. Additionally, Tether has reduced its exposure to Chinese commercial paper.

“Tether’s exposure to Chinese commercial paper was predominantly in the banking sector but all Chinese paper held was liquid and issued by large and well-known issuers in the international commercial paper market.”

The notes continued and revealed the following as per the online publication the Daily Hodl:

“All of these issuers were stable and much of this paper was and is held by some of the world’s largest investment managers within conservative portfolios. The Chinese banking-related commercial paper at issue was rated A1 or better.”

The same notes continued and revealed this:

“Furthermore, it’s worth noting that Tether reduced its commercial paper holdings to zero last year. Tether did not lose a dime on any commercial paper, including the Chinese commercial paper.”

A source with knowledge of the situation has provided a list of deactivated accounts, which includes companies such as MoonPay, BlockFi, CMS Holdings, and Galois Capital. BlockFi is currently undergoing bankruptcy proceedings while Galois Capital has already shut down.

The list consists of both companies and individuals who were terminated for various reasons. Interestingly, some of the documents date back to June 2021, even though the NYAG investigation concluded in February of the same year.

Make sure to check out our previous article in order to learn more details about this.