The USDT stablecoin is backed by real assets such as fiat currency and bonds, so it is always held at a stable 1:1 against the US dollar.
Tether CTO Paolo Ardoino said the company’s excess reserves rose $700 million in the current quarter to $1.66 billion.
“This money stays in Tether for further capitalization of the stablecoin,” Ardoino explained.
Asked if Tether could weather the Silicon Valley Bank (SVB) crisis, Ardoino said he didn’t understand why people still doubt the company’s reserves even after traditional lenders have collapsed.
“First of all, after Credit Suisse and all the other banks that are failing, why are they looking at Tether again? Tether makes money and banks fail. So if you need to invest somewhere, I think Tether is the safest of all options,” he said.
The collapse of the SVB in March led to an unprecedented collapse in the value of the USDC. After a hard fall to $0.88, the stablecoin was able to return to $0.97. USDC thus became one of the first casualties of the SVB collapse, as the failing bank held approximately $3.3 billion of Circle’s assets.
Source: Bits
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