Tether now holds zero commercial paper
One of the largest stablecoin issuer in the world, Tether announced it now holds zero commercial paper and has fully replaced its holdings with U.S. Treasury bills (T-Bills), according to its blogpost published on Oct. 13.
Commercial paper or short-term IOUs are short-term, unsecured debt issued by companies usually to meet short-term liabilities.
The company explained the move is part of its ongoing efforts to increase transparency, foster trust in the stablecoin industry and back its stablecoins with the most secure and liquid reserves on the market.
‘Reducing commercial papers to zero demonstrates Tether’s commitment to backing its tokens with the most secure reserves in the market,’ the company said.
The company has been under scrutiny as it was rumoured that 85% of Tether tokens were backed by Chinese commercial paper in October last year. Tether refuted the allegations and announced it would reduce its commercial paper reserves to zero.
On July 1, the company announced its progress in reducing its commercial paper to US$ 3.5 billion. By the end of September, the company announced it was below US$ 50 million in commercial paper holdings.
In addition, Tether hired BDO Italia in August to conduct regular reviews and attestations of its reserves and plans to increase its reporting frequency from quarterly to monthly.
There are currently around 68.4 billion tether tokens in circulation, according to data from CoinMarketCap, an increase from 2 billion three years ago. The cryptocurrency has a market capitalization of $68.4 billion.