With StableCoin regulations around the corner it would be interesting to know how these StableCoins are backing their worth. One of the most controversial Stablecoins out there is Tether. Bloomberg brought out a report where they tried to investigate where Tethers reserves are and of what they are build of. In this article we will take a look on the findings that Bloomberg found and will talk about what this means for the future of the crypto market. Like always, this article is only for entertainment purposes and not financial advice.
Bloombergs findings on Tether
With over 69 billions Tethers in circulation this should mean that Tether has 69 billion $ to back this up. With this question in mind Bloomberg started an investigation on Theter and these are the five main takeaways:
- Tether has some holdings on Chinese commercial papers. This includes billions of dollars worth of short-term loans to Chinese companies.
- Millions of dollars are being made by crypto backed loans. A portion of these loans are backed by BTC. One of the more prominent loaners is Celsius Network.
- The former CEO of Noble Banks, John Betts, says that Tether’s top executive put some reserves at a big risk. He invested them to earn for his own profit and earned potentially millions of USD.
- Tether does not keep all of its assets at a bank in the Bahamas.
- The U.S. criminal investigation is investigating against several Tether executives. They are examining whether these Tether employees deceived banks to open accounts
Tether was a fear uncertainty doubt in the crypto world for years now. In fact, news like that are already called “Tether FUD”. This does not mean that these investigations are going to put the crypto market at risk. On the other hand, these investigation will not make the market pump either. Furthermore, Tether is defending itself by basically saying that the media is trying to repackage old stuff in new bad news and therefore hurting them.
Conclusion
In my opinion this news should not be too concerning. On the one hand, yes, if one of the biggest Stable Coin providers gets in trouble this would mean a set back for the whole crypto market. On the other hand, this would mean a good buy in opportunity for long-term investors and a more stable future for crypto in general. Furthermore, some Stablecoin regulations could not harm to prevent things like these happening again. In other words: If you believe in crypto news like these should not concern you too much since they can be just a temporary set back but for the long run the crypto future still looks bright.
Published by ga38jem on Publish0x on the 11th October 2021
Published by ga38jem on LeoFinance on the 11th October 2021