Tether denies claims that 85% of its USDT reserves are backed by Chinese commercial paper

Tether said that rumors that 85% of the reserves backing the stablecoin USDT were held in Chinese commercial papers trading at a 30% discount are false.

Tether Condemns False Rumours About Its Commercial Paper Holdings https://t.co/J2Oj4lTNPy

— Tether (@Tether_to) June 15, 2022

The firm suggested that the information is being spread by some “co-ordinated funds” to reap additional profits in an already stressed market.

The issuer reminded that it has steadily reduced the share of commercial papers in its reserves. As of March 31, it stood at 25%. By contrast, US Treasury securities accounted for 47%.

Since then, the dollar value of commercial papers in the portfolio has fallen from $20 billion to $11 billion. It is expected to reach $8.4 billion by the end of June.

According to CoinGecko, the market capitalisation of the leading stablecoin stands at around $71.4 billion. USDC, the second-largest by supply, stood at $54.7 billion.

Tether emphasised that the unwinding of Celsius positions did not incur losses.

“Currently, Tether has no relationship with Celsius, except for small investments in the stock of the crypto-lending platform,” the statement said.

The company also said that reports that Tether loaned to Three Arrows Capital, which allegedly faced solvency problems, were false.

Earlier, Cumberland’s crypto OTC platform suggested that the next asset at risk of a crash could be one of the leading stablecoins.