Stablecoin company Tether released its attestation report for the third quarter today on its official website. It revealed a new milestone of etching the highest percentage ever of its reserves held in cash and cash equivalents (C&Ceq).
The percentage stood at an impressive 85.7%. A vast majority of these C&Ceq are in the form of US T-Bills, which account for $72.6billion. This figure includes both direct and indirect exposure to US T-Bills.
The company linked the high percentage in C&Ceq to Tether’s commitment in maintaining liquidity and ensuring stability within the stablecoin ecosystem. Its CEO, Paolo Ardoino, said in a statement: “We’ve achieved the highest ever percentage of our reserves held in Cash and Cash Equivalents, signalling our dedication to maintaining liquidity and stability within the stablecoin ecosystem.”
Along with this, Tether also holds $1bn worth of Bitcoin ($BTC), as well gold worth $3.1bn. With excess reserves of $3.2bn, the total Tether tokens ($USDT) outstanding worth stood at $83.2bn.
The report emphasised a significant reduction in the amount of secured loans extended by Tether, which now amounts to only over $330m. This move bolstered “confidence in Tether’s ability to manage its financial assets prudently”. It also showcased its dedication to transparency and accountability within the cryptocurrency space.
Elaborating further on transparency and openness, Tether disclosed investments made in industry-related research fields totaling over $800m since the start of the year. In this quarter itself, nearly $670m was invested. These investments are not considered part of the reserves backing the issued token.
Despite market volatility and fluctuations in gold and Bitcoin prices, the excess reserves buffer remained stable, said the report. There was a reduction of $116m for gold inventory and $195m for BTC positions at the end of Q3 2023. However, price increases in gold and Bitcoin in October have strengthened Tether’s financial position.
The Management of the Company also illustrated a few other data points. As of 30 September 2023, the Group’s consolidated total assets amounted to at least $86,384,653,832. Its consolidated total liabilities amounted to $83,176,997,409 of which $83,153,363,663 relate to digital tokens issued. In laying this out, it showed that the Group’s consolidated assets exceeded its consolidated liabilities.
The report then highlighted how the Tether Group did not consider investments made into sustainable energy, Bitcoin mining, data, and P2P technology as part of its reserves backing the issued token. Investments in these fields for Q3 2023 amounted to $668,891,473, and $809,491,473 since the beginning of the year.
It reiterated that the goal of the company is to reduce and eventually remove the exposure of secured loans from the reserves, leveraging the company’s excess reserves and undistributed profits.
As of 30 September, Tether had $3.2bn in excess reserves with only $2bn in secured loans. By 31 October 2023, the forecast shows $4.2 bn in excess reserves with only $0.9 bn in secured loans.
The report ended with another statement from Ardoino, which said: “Tether’s Q3 attestation is a testament to our unwavering commitment to transparency, stability, and responsible financial management…..Our ability to reduce secured loans and weather market volatility is a demonstration of our robust risk management strategies.
“We are proud of the robustness of Tether’s operational profits, showcasing our financial strength and resilience. Moreover, our investments in sustainable energy, Bitcoin mining, data, and P2P technology exemplify our commitment to building a more sustainable and inclusive financial future for all.”
