Deltec Bank: Tether’s USDT fully backed by reserves

The Bahamas-based Deltec Bank, which holds Tether’s assets, has said that USDT is fully backed by reserves.

An insightful podcast about Tether with Gregory Pepin, deputy CEO at Deltec Bank and Trusthttps://t.co/AXHMimwPZG

— Tether (@Tether_to) January 22, 2021

“Each Tether [USDT] is backed by reserves that exceed what is in circulation. We can see this for ourselves; I can confirm it,” said Gregory Pepin, Deputy CEO of Deltec, during the Unchained podcast.

Many market participants have long voiced concerns about the extent of backing for the most capitalized stablecoin. In May 2019, Tether Limited’s chief legal officer Stuart Hogner confirmed that the stablecoin USDT was backed by fiat reserves only at 74%.

On Tether’s website the following is stated:

“Each Tether token is always 100% backed by our reserves, which include traditional currencies and cash equivalents. From time to time they may include other assets and receivables from loans extended by Tether to third parties, including affiliated entities.”

Market participants’ concerns were heightened after the recent appearance of the Medium publication, which pointed to a ‘significant’ mismatch between the Tether supply issued since the start of last year and the funds held at Deltec Bank.

“There wouldn’t be enough dollars in any Bahamian bank to back the Tether coins circulating in the cryptocurrency market,” writes a user Crypto Anonymous.

Tether began storing reserves at Deltec in October 2018. Before that, the stablecoin issuer was serviced by a number of Taiwanese banks. The correspondent bank was Wells Fargo in the United States. The move followed a block on transactions that led to litigation.

Over the past 12 months, USDT’s market capitalization rose from $4 billion to nearly $25 billion, according to CoinGecko. The asset ranked third in market capitalization, behind only Bitcoin and Ethereum.

As reported recently, Deltec Bank announced the acquisition of a substantial amount of bitcoins for its clients.

ForkLog had previously reported that the emission rates of USD Coin (USDC) and Binance USD (BUSD) outpaced the USDT token’s metrics.

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