Stablecoin Issuer Tether Cuts Commercial Paper Holdings to Zero
Stablecoin issuer Tether has reduced its commercial paper holdings to zero, replacing those holdings with U.S. Treasury bills, the company announced in a blog post Thursday.
“Reducing commercial papers to zero demonstrates Tether’s commitment to backing its tokens with the most secure reserves in the market,” Tether wrote.
As of Sept. 30, the company's U.S. Treasury holdings stood at 58.1% of its total portfolio, up from 43.5% at the end of June, Tether CTO Paolo Ardoino tweeted earlier this month. Tether did not specify what percentage of its current portfolio was held in U.S. Treasuries in its latest post.
Commercial paper is short-term unsecured debt issued by companies, where the value of the paper is dependent on the issuing company. Commercial paper is less stable than other debt instruments, such as U.S. Treasury bonds.
Tether had earlier said that it would bring its commercial paper holdings to zero by the end of the year because of growing concerns over the stability of the Tether ecosystem and its stablecoin, USDT.
In October, Tether said it had cut its commercial paper holdings to less than $50 million.
UPDATE (Oct. 13, 17:14 UTC): Added information from Tether CTO's tweet in third paragraph.