Tether Discloses More Details on Reserves in New Attestation Report

Divya  |  Aug 10, 2021

Tether Holdings Limited, the company behind the largest stablecoin USDT released a detailed breakdown of its $62.8 billion reserves in a new attestation report. The much sought-after details included the composition of Tether’s reserves and the maturity and ratings of its certificates of deposits (CDs) and commercial paper (CP).

Latest Attestation Report Indicates Tether Increased Allocation to Treasury Bills 

As per the report issued on June 30, 85% of USDT’s reserves were allocated to cash and cash equivalents and other short-term deposits and commercial paper. The majority of funds in this category -- 58% to be exact -- were held in commercial paper and certificates of deposit. Almost $14.5 billion, or 47% of these holdings, were rated A-1.

Most notably, Tether ramped up its asset diversion to treasury bills since March and its current allocation here stands at 29%. 

Other holdings included cash and bank deposits, which accounted for 12% of the allocations, secured loans for 4%, and corporate bonds, funds, and precious metals for 7.7%.

The company’s other investments were constituted of digital tokens -- which represented 3.3% of the reserves at $2.05 billion.

Tether Makes CP and CDs More Transparent In Second Report

The latest attestation report was remarkably more transparent than the one released in May and delved deeper into the ratings of commercial paper holdings and their maturity periods. The majority of CDs and CP were rated A-1, as assessed by the Standard and Poor rating agency. These were followed by 45% and 5.5% of A-2 and A-3 CP and CDs allocations.

Most of these commercial papers and certificates of deposit had a maturity period of 81-365 days. The remaining were due for maturation between 0–90 days and 91–180 days.

The June 30 report was Tether’s second public revelation of its asset composition since its establishment in 2014. In the absence of a formal audit, attestations are increasingly vital to stablecoin issuers, given the scrutiny around the asset class in Washington. The current report was issued by Cayman Islands-based accounting firm Moore Cayman.

Paolo Ardoino, the CTO of Tether, said the attestation proved that the currency was completely backed. He added, "A healthy and conservative portfolio with an emphasis on liquidity continues to fuel our growth and confidence in our innovative offerings."

 

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