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Tether’s circulating supply of USDT drops by $7 billion in a week

Tether’s circulating supply of USDT drops by $7 billion in a week

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Answer Tether’s circulating supply of USDT drops by $7 billion in a week

Tether, the company behind the largest stablecoin by market capitalization USDT, has seen the circulating supply of the digital stablecoin drop after investors withdrew more than $7 billion from it.

Investors are losing faith in stablecoins:

Data from CoinGecko shows that the circulating supply of USDT is currently $75.9 billion, down from about $83 billion a week ago, according to CNBC.

This development came shortly after the USDT lost its peg to the dollar on some trading platforms, as the USDT price fell to $0.96 in the wake of the Terra UST saga and crash.

Although USDT has regained its correlation with the dollar on the trading platforms, it appears that investors have lost some confidence as they withdraw $7 billion from the stablecoin.

Read:A trader in the cryptocurrency world committed suicide after the losses of his “investment fund”

Ki Young-joo, CEO of crypto-transaction analysis platform CryptoQuant, asked Tether CTO (CTO) Paulo Arduino if the $75 billion in circulation is fully backed.

Arduino responded by saying:

We got $7 billion back in 48 hours, without even the blink of an eye.

How many institutions can do the same?

We can continue if the market wants, and we have all the liquidity to handle big redemptions and pay every 1 tether to $1.

Yes, Tether is fully supported.

The stable Tether reserve is usually exposed to criticism, as it is often debated whether the USDT is actually backed by a 1:1 ratio to the dollar.

Meanwhile, the company has been reducing the amount of commercial paper backing USDT in the past six months.

The latest reduction occurred earlier in May, as the CTO of Tether stated that the stablecoin issuer would continue to reduce its holdings of commercial paper.

Meanwhile, Arduino noted that most of the company’s reserves are held in US Treasuries.

The CEO of CryptoQuant asked Tether’s CTO that Tether should provide an audit of USDT, which reflects past data from members of the crypto community.

Read:The market value of Ethereum surpasses that of Visa after reaching half a trillion dollars

Arduino responded that the company is already working on the audit, adding:

Hopefully, regulators will push more audit firms to be more friendly with crypto firms.

Read also:

After the collapse of Terra…G7 officials discuss new crypto law this week

Dogecoin co-founder: 95% of cryptocurrencies are scams or scams!


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