Tether solvency fears are ‘misplaced’ as company sits on large surplus: CoinShares
Analysis
Price Impact
LowCoinshares' head of research refutes solvency fears regarding tether (usdt), citing a $6.8 billion surplus in its latest attestation report. this counters concerns raised by arthur hayes and s&p global, suggesting that the largest stablecoin remains stable and well-backed.
Trustworthiness
HighThe analysis is provided by coinshares' head of research, james butterfill, and is based on tether's official attestation report, providing data-driven reasoning.
Price Direction
NeutralWhile the news dispels negative fud around tether's solvency, it primarily reinforces the stablecoin's peg and stability rather than driving significant price movement for usdt itself. for the broader market, mitigating systemic risk from the largest stablecoin is a positive, but the direct price impact is likely neutral as it confirms existing conditions for many.
Time Effect
ShortThe information directly addresses recent solvency concerns and provides immediate reassurance based on current financial data. the effect is likely to stabilize confidence in the near term.
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Article Content:
Sam Bourgi 3 minutes ago Tether solvency fears are ‘misplaced’ as company sits on large surplus: CoinShares James Butterfill counters claims about Tether’s solvency, pointing to a multibillion-dollar surplus despite new criticism from Arthur Hayes and S&P Global. Listen 0:00 News COINTELEGRAPH IN YOUR SOCIAL FEED Concerns about stablecoin issuer Tether’s financial stability resurfaced this week after BitMEX founder Arthur Hayes warned the company could face serious trouble if the value of its reserve assets were to fall. But CoinShares’ head of research, James Butterfill, pushed back on those claims. In a Dec. 5 market update , Butterfill said fears over Tether’s solvency “look misplaced.” He pointed to Tether’s latest attestation, which reports $181 billion in reserves against roughly $174.45 billion in liabilities, leaving a surplus of nearly $6.8 billion. “Although stablecoin risks should never be dismissed outright, the current data do not indicate systemic vulnerability,” Butterfill wrote. Tether remains one of the most profitable companies in the sector, generating $10 billion in the first three quarters of the year — an unusually high figure on a per-employee basis . Related: Arthur Hayes tells Zcash holders to withdraw from CEXs and ‘shield’ assets The latest source of Tether anxiety While speculation about Tether’s financial health is hardly new — media outlets have probed its reserves and asset backing for years — the latest round of solvency worries appears to stem from Arthur Hayes. The BitMEX co-founder said last week that Tether was “in the early innings of running a massive interest-rate trade,” arguing that a 30% drop in its Bitcoin ( BTC ) and gold holdings would “wipe out their equity” and leave its USDt ( USDT ) stablecoin technically “insolvent.” Both assets make up a substantial portion of Tether’s reserves, with the company increasing its gold exposure in recent years. Source: Arthur Hayes Tether is facing criticism from more than just Hayes. CEO Paolo Ardoino recently pushed back on S&P Global’s downgrade of USDt’s ability to defend its US dollar peg, dismissing the move as “Tether FUD” — shorthand for fear, uncertainty, and doubt — and citing the company’s third-quarter attestation report in its defense. S&P Global downgraded the stablecoin over stability concerns, citing its exposure to “higher-risk” assets such as gold, loans and Bitcoin. Source: Paolo Ardoino Tether’s USDt remains the largest stablecoin in the cryptocurrency market, with $185.5 billion in circulation and a market share of nearly 59%, according to CoinMarketCap . Magazine: China officially hates stablecoins, DBS trades Bitcoin options: Asia Express # Business # Arthur Hayes # Tether # Stablecoin Add reaction