In a CNBC interview, Howard Lutnick, the CEO of Cantor Fitzgerald, a leading Wall Street brokerage firm, shared his admiration for Tether, the largest stablecoin issuer, and Bitcoin, the top cryptocurrency. He also disclosed that he holds Tether’s treasuries, worth over $90 billion.
Lutnick, who described himself as a “big fan” of Tether, said that Cantor Fitzgerald has been managing Tether’s multibillion-dollar United States Treasury portfolio for several years. He said Tether’s treasuries are “very safe” and “very liquid.”
The partnership between Cantor and Tether reportedly started in late 2021, according to anonymous sources cited by The Wall Street Journal in a February 10 report.
Cantor Fitzgerald, which is one of the few brokerage firms that can trade Treasury bonds, has overcome the hesitation of major financial institutions to provide services to Tether.
Wells Fargo, for example, stopped processing Tether’s wire transfers for its Taiwanese accounts in 2017.
Despite being the largest stablecoin by market capitalization, Tether faces criticism for its lack of transparency regarding reserves. In a recent stablecoin stability assessment by S&P Global, Tether received the second-lowest rating out of eight U.S. dollar-pegged stablecoins.
The assessment considered factors such as asset management, audits, risk appetite, primary market redeemability, secondary market payment rails, and the track record of maintaining its U.S. dollar peg.
While acknowledging concerns about Tether’s long-term stability, Lutnick suggested potential benefits for countries facing currency collapse, citing Argentina as an example.
Argentina’s president, Javier Milei, has expressed intentions to abolish the country’s central bank and transition to the U.S. dollar.
James Check, the lead on-chain analyst at blockchain analytics firm Glassnode, envisions Tether as a potential central bank digital currency (CBDC) controlled by the United States.
Initially expressing a general favor for crypto, Lutnick later refined his praise to focus specifically on Bitcoin. He expressed skepticism about “other coins,” referring to them as “make-believe.”
Lutnick highlighted Bitcoin’s halving cycles and lack of a centralized entity as key reasons for considering it a valuable asset.
In contrast, he pointed out that Tether can be frozen upon request, and Ethereum can be influenced by individuals such as Joe Lubin.
“I am a fan of crypto, but let me be very specific: bitcoin, just bitcoin. These other coins, they are just not a thing,”… “I’m a big fan of this stablecoin called Tether, I hold their Treasuries. So I keep their Treasuries, and they have a lot of Treasuries,”
Howard Lutnick on CNBC’s Money Movers podcast.
