tether has stated that its secured loans are heavily collateralized in response to a recent report claiming Tether-led trouble in the sector.
The Wall Street Journal белешки in its report that Tether has not disclosed its USDT stablecoin-issued loans. It further questions its longer-term liquidity to honor redemptions. The concerns come after one of the largest crypto exchanges, FTX, filed for Chapter 11 bankruptcy this month. WSJ underlines that the subsequent market decline could have diluted Tether’s collateral.
The report also remarked, “Tether doesn’t say what the loans’ market value is, or whether the collateral includes cryptocurrencies.”
In response, Tether stated, “The article had many misconceptions of Tether and USDT, the most glaring of which was the claim that because Tether’s secured loans of USDT were denominated in USDT, Tether was exposed to a decline in the value of USDT.”
Tether Under the Microscope After FTX Collapse
Tether has a long-standing history of trouble with the regulators. Questions around Tether’s reserves erupted even around the Земјата Луна crisis and the 3AC-led market collapse. Once again, the FTX bankruptcy has renewed concerns around the top стабилен by market capitalization, especially when information about the role of FTX token FTT has shed light on the firm’s overleveraged position.
That said, USDT also lost its dollar peg briefly following the contagion.
However, Tether argued, “This completely misses the mark and mistakes the USDT itself for the collateral that underpins it. Tether’s secured loans are extremely overcollateralized and even backstopped by additional equity if needed.”
Source: https://beincrypto.com/tether-hits-back-wsj-claims-usdt-loans-overcollateralized/