USDT issuer Tetherhas long been considered one of the most stable assets in the cryptocurrency market, but according to a recent report, Bitcoin price crash This may jeopardize the solvency of stablecoins. Arthur Hayes, co-founder and CIO of BitMEX, stated that a portion of USDT reserves could be allocated to BTC, potentially increasing market volatility.
Bitcoin price crash threatens Tether USDT stability
In a recent report shared Earlier this week on X, Hayes outlined market risks that could have a catastrophic impact on Tether’s USDT. The BitMEX founder explained that the stablecoin issuer has been conducting large interest rate transactions and has probably bet on amounts of: Federal Reserve (FED) interest rate cut.
He said that the stablecoin issuer Has amassed a significant position in Bitcoin. Gold to prepare for decline in interest income. As a result, Hayes warned that a roughly 30% decline in Tether’s positions in both gold and Bitcoin could wipe out the entire asset, theoretically putting USDT at risk. bankruptcy.
Since stablecoins are typically backed by the U.S. dollar, the cryptocurrency founder said a significant drop in the value of Tether’s holdings could cause people to panic. USDT holders And cryptocurrency exchange. These scenarios may require immediate insight into the stablecoin issuer’s balance sheet to gauge solvency risk. Hayes also suggested that mainstream media could further amplify concerns, creating widespread market awareness.
Analyst Hits Back at Hayes’ USDT Claim
Following Hayes’ statement about Former Citi Research leader Joseph Ayoub said: challenge Hayes’ argument is that even if Bitcoin and gold prices plummet 30%, there is little chance of USDT going bankrupt.
he emphasized it BitMEX Co-Founder You missed three key points in his post. Ayoub said Tether was publicly published Assets are not representative of all of a company’s holdings. According to him, Tether maintains a separate asset balance sheet when issuing USDT. Not publicly reported. The preliminary numbers that are eventually released are intended to show how USDT is backed. At the same time, the company maintains a balance sheet for: equity investmentMining operations, corporate reserves, more Bitcoin, and the rest is distributed to shareholders as dividends.
Ayoub also explained: Tether’s highly profitable core business It’s efficient. He said the company holds more than $100 billion in interest-bearing government bonds and generates liquid profits of about $10 billion annually while running a relatively small team. The former head of Citi research estimated that stablecoin issuers are likely to have between $50 billion and $100 billion in assets, which would provide a significant cushion against losses. Cryptocurrency and Gold Holdings.
Lastly, Ayoub said Tether operates like a traditional bank, keeping only 5-10% of deposits as liquid assets and the remaining 85% as long-term investments. He also noted that stablecoin issuers are providing much better collateral than banks. ability to print moneyBankruptcy is virtually impossible.
Featured image from Shutterstock, chart from Tradingview.com
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