Tether USDT Records New Milestone As Its Assets Exceed Liabilities
The world’s largest stablecoin issuer, Tether, is reported to have completed its reserve attestation under BDO, the global accounting giant. According to the BDO’s report, Tether’s consolidated reserves report (CRR) at the end of 2022 has met the firm’s approval mark.
A Boost In CRR Ratings
Tether has met the BDO’s assurance level, having seen its consolidated assets jump to $67 billion at the end of 2022. It exceeded the stablecoin issuer’s consolidated liabilities amounting to $66 billion, and its excess reserves totaling $960 million.
Furthermore, the CRR report shows that Tether has reduced its committed secured loans, and most importantly, the stablecoin rounded up 2022 with no exposure to commercial paper.
Tether halted its use of commercial papers in mid-October 2022 while replacing them with US Treasury Bills. However, the company initially announced its plan to remove all commercial paper from its USDT reserves by last June.
As of then, commercial paper made up less than 25% of the stablecoin’s total funds valued at $82 billion. In a tweet on Thursday, February 9, Paolo Ardoino, Tether’s chief technology officer, stated that the company had exhibited an impressive ability to weather the storm that had engulfed the entire crypto market for most of last year.
According to him, Tether has shown a superb approach to managing risks at a time when most crypto firms are struggling to stay in business amid the bear market trend.
Ardoino added that Tether had demonstrated excellent leadership and continues to consolidate profits. Meanwhile, according to the document, the BDO report is without limitations as the auditing data focused on the CRR metrics and other consolidated liabilities as of December 31, 2022.
The accounting firm added that activities after the period were not included when evaluating the reports’ balances and information. In addition, BDO confirmed that it has yet to do any procedures on the financial or non-financial activity and dates outside of the time covered in its assessment of Tether’s liability reserves.
A Decline in Stablecoin Dominance
Per multiple reports, the overall evaluation of the stablecoin market has significantly dropped from its all-time high, with algorithmic stablecoins the hardest hit.
The market report from the on-chain analytic platform, CryptoCompare shows that the market share for algorithmic stablecoins as of January 26 stands at 1.71%, with an all-time high of 12.4% reached in April 2022.
However, the Terra USD crash was the trigger that led to the steady decline in the value of algorithmic stablecoins. January 2023 marks the tenth consecutive month of a continued decline in the market capitalization of stablecoins.
December 2022 witnessed the outflow of $3.65 billion in stablecoins from centralized exchanges. Some stablecoin issuers are struggling for relevancy after the move by Coinbase to introduce a zero-transaction cost to swap USDT for USDC last December.
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