In order to dispel speculations, the stablecoin issuer declared last month that it will be eliminating all commercial paper from its holdings.
According to plans, Tether is lowering its holdings of commercial paper, the stablecoin business announced on Friday. According to initial plans revealed last month, it has met the target amount of $8.4 billion in commercial paper and will keep cutting back on its holdings in the near future.
Tether will have $3.5 billion in commercial paper in its portfolio as of July 31 after $5 billion of its holdings mature. The study noted that as a result, treasury reserves will represent a higher share of the company’s reserves.
As of March 31, the $20.1 billion in commercial paper backing for the Tether stablecoin USDT was available. According to the company’s quarterly assurance opinion, its reserves were completely backed and the proportion of commercial paper in them was declining.
For a brief period in May, the stablecoin lost its peg due to general market turmoil. Tether released a statement on June 15 to deny allegations that 85% of that portfolio was Asian and Chinese commercial paper trading at a steep discount, two days after cryptocurrency lending company Celsius announced it was stopping withdrawals. Tether declared at the time that it wanted to get rid of all of its commercial paper holdings. A few days later, the USDT market cap dropped to below $70 billion, an eight-month low.
But those are not the only stability issues Tether is facing. In a lengthy thread on Twitter on Monday, Paolo Ardoino, the chief technology officer of Tether, said that hedge funds were “attacking” the stablecoin. The same hedge funds “believed and assisted all the FUD generated by the truthers in the last months [and] years,” the speaker continued.