World’s most traded stablecoin, Tether, has denied holding Chinese commercial paper in its reserves and has said it is planning to reduce its commercial paper holdings overall. Tether has claimed that its total commercial paper holdings has been cut to $3.7 billion from $30 billion just one year ago.
Tether rejected commercial paper holdings in a paper that reads it “holds no Chinese commercial paper as of today, and it has brought down its total commercial paper exposure to about US$3.7 billion from US$30 billion in July 2021.”
Paolo Ardoino, Tether chief technology officer, claimed that USDT hedge funds had subjected Tether to “Coordinated attacks” to be able to buy Tether at a much lower USDT price and believed the rumors about Tether commercial paper portfolio being %85 backed by backed by Chinese or Asian commercial papers was a result of the attacks and were aimed to spread panic among people.
According to Ardoino, since then the stablecoin has been collaborating with regulators to increase transparency efforts and phase out its commercial paper exposure.
Tether noted in its latest blog post that falsifications are the biggest threat to the crypto industry saying that:
“It is a threat of the same concern as scams, hacks or cyberattacks because the spreading of false information risks not only the reputation of the industry but also each and every member of the community.”
This basically means that Tether promises to have no commercial paper holdings by the end of November.
The platform has also added that, “Tether continues to ensure that it has a diversified portfolio with limits to exposure on individual issuers or assets. Its reduction in commercial paper is a commitment to its community.”
It’s worth mentioning that a Bloomberg investigation in October reported that Tether had made out short-term loans to large Chinese corporations from its reserves.