Tether Responds to Rumors of Chinese Securities in Reserves

Tether, one of the largest stablecoin issuers, has published an extensive response to rumors that its reserves once included Chinese company-issued securities.

On June 16, mainstream media outlets such as Bloomberg reported that the company once held securities issued by Chinese state-owned companies.

Bloomberg cited documents disclosed by the New York Attorney General (NYAG) to demonstrate that USDT was once backed by securities issued by the Industrial & Commercial Bank of China, China Construction Bank Corp., and the Agricultural Development Bank of China.

The issuer of USDT responded to the reports the same day, stating that they “do not condone this behavior” and that their top priority is their customers.

“Ultimately Bloomberg, CoinDesk or any other media outlet’s decision to present this information to its readers was likely done in haste with little attention to current events or facts.”

Additionally, the stablecoin issuer noted that the materials obtained by media entities do not reflect the company’s current state. According to Tether, the data sent to media platforms is limited and older than two years.

Moreover, Tether clarified that its exposure to Chinese commercial papers was liquid and that all issuers were stable.

The company also stated that some of the world’s largest investment managers utilize the documents. “The Chinese banking-related commercial paper issued was rated A1 or better,” they added.

Additionally, the stablecoin issuer noted that its exposure to commercial paper holdings had been reduced to nil in the preceding year.

According to Tether, no money was lost on any commercial document. This includes corporate debt issued by Chinese companies.