More Evidence Points to Tether's (USDT) Dollar Backing

A new Bloomberg report suggest that Tether Ltd may really have $1 for every USDT in circulation.

Published a few hours ago (Dec 18th) the report indicates that Bloomberg has documents in their possession that “offer more detail than has ever been made public”.

The documents were not shared and do not provide a complete overview of Tether’s finances. However, bank statements from four separate months reveal the amount of dollars held in Tether Ltd.’s accounts.

One statement demonstrates that on January 31, Tether held $2.2 billion in a bank account at Puerto Rico’s Noble Bank. This was exactly the same amount (2.2 billion) of USDT in circulation on that same day. The numbers also match up in both September and October of last year.

The bank statements however, do not show where the funds originated from nor their present location, as Tether Ltd. has worked with several different banks in its three-year history.

Bloomberg did not disclose who provided the documents but writes that it was someone with access to the company’s records. Bloomberg also affirms that the veracity of the documents was confirmed by a government official.

The Origins of the Tether Suspicions

Back in January, the U.S. Commodity Futures Trading Commission (CFTC) issued subpoenas to Tether Ltd. and Bitfinex, in order to determine if the companies claimed to have the necessary money to back the USDT’s in circulation. The investigation hasn’t yet produced any results and its status is as of the time of writing undetermined.

Following the subpoenas, many conspiracy theories started emerging, claiming that Tether might not have the funds it claims, and that USDT was involved in manipulating the price of bitcoin. The U.S. Justice Department is currently investigating whether the last bitcoin bull run to $20,000 was a consequence of unethical Tether trades.

Despite all the negative claims, having lost its peg by a considerable amount more than once, and the competition from several stable coins that have entered the market this year, Tether has remained somewhat resilient. In fact, just yesterday Tether briefly surpassed Stellar (XLM) as the 4th largest cryptocurrency.

Insider Says Tether Will Issue a Yuan-Backed Stablecoin

Michael LaVere
  • Bitfinex shareholder Zhao Dong revealed that Tether will be launching a yuan-backed stablecoin.
  • New token is expected to launch "very soon," potentially in the next several weeks. 

Tether, the company behind the popular USDT stablecoin, is reportedly planning to issue another stablecoin backed by the Chinese Yuan, according to an insider with ties to the organization. 

New Stablecoin From Tether

On Aug. 22, OTC trader and Bitfinex shareholder Zhao Dong said on WeChat that Tether is looking to launch another stablecoin backed by the Yuan, with offshore reserves held in Belgium. Bitfinex has shared ownership and management with Tether, giving more credence to the claim. 

Dong says that the new coin will be called CNHT.

He added, 

Personally, I think the offshore yuan stablecoin could boost the circulation of offshore renminbi and internationalize it. Regulators may be happy to see it proceed and succeed.

Speaking with CoinDesk, Zhao said that he believes the stablecoin will launch “very soon, possibly within weeks.” While Tether has previously come under fire for the uncertainty surrounding its reserves of USDT, which is supposed to be 1:1 with the US dollar, Zhao claims that the company will hold its reserves in a Belgian bank. 

Zhao anticipates that introducing a yuan-backed coin will reduce the company’s dependence on the U.S. dollar and also increase the circulation of renminbi held offshore. 

Tether has yet to comment on the situation, or provide clarity over which blockchain the new coin will be built on top of. USDT launched on bitcoin’s network originally, but the company has since issued coins using ethereum and tron.