Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Cash made up only 2.9 per cent, according to the companys disclosure. Our Standards: The Thomson Reuters Trust Principles. I think one time, Stanley mentioned when he saw employees on downtime he . BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back. Join our Telegram Group and get trading signals, a free trading course and daily communication with crypto fans! This license does not include nor permit your resale or commercial use of the Site or its contents. According to a spokesperson from Tether, Tether does not hold any commercial paper or other debt or securities issued by Evergrande and has never done so. Tether is completely unbacked USD that gives these exchanges the liquidity they need to market make derivatives that have non-linear . Tether grants you a limited license to access and make personal use of the Site. The downgrade notice was sent to Evergrande on Sept. 15 from China Chengxin International. Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile. We want to hear from you. Get the latest business insights from Dun & Bradstreet. Tether said that it funnelled roughly half its reserves into commercial paper. It is also alleged that Tether also owns commercial paper issued by Evergrande, China's second-largest real estate developer, which is itself experiencing a major liquidity crisis. See here for a complete list of exchanges and delays. Head to consensus.coindesk.com to register and buy your pass now. Sign up for The Node, our daily newsletter bringing you the biggest crypto news and ideas. Tether has become one of the most important components of the cryptocurrency ecosystem, with more than 35bn tethers printed so far this year, more than double its supply in January. Learn more about Consensus 2023, CoinDesks longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. A Bloomberg report has claimed to have found that Tether holds billions of dollars worth of Chinese commercial paper. 2023 CNBC LLC. Got a confidential news tip? As demand for tether grew, market participants started to question whether that was the case. By signing up, you will receive emails about CoinDesk products and you agree to ourterms & conditionsandprivacy policy. Tether does not hold any commercial paper or other debt or securities issued by Evergrande and has never done so, the company said. When Tether launched in 2014, it said every tether coin was fully backed by US dollars in bank accounts. By signing up, you will receive emails about CoinDesk product updates, events and marketing and you agree to our, Bankman-Fried Should Have Only Flip Phone, Website Whitelist, DOJ Says, With Congress Impotent, Courts Are the Only Option for Fighting SEC Overreach, Silvergate Closes SEN Platform Institutions Used to Move Money to Crypto Exchanges, Binance.US Is Operating 'Unregistered Securities Exchange,' SEC Official Says. Evergrande, Chinas second-largest property developer by sales, recently warned that it was in danger of defaulting on massive debts. Tether reserves the right to change these Terms at any time without notice, and such changed Terms will take effect once we post them at the Site. The stablecoin issuer Tether this week declared that it doesnt hold short-term debt issued by troubled Chinese real estate developer Evergrande. The struggling real estate giant has listed $300 billion in total liabilities and says it needs to find funds quickly. All quotes delayed a minimum of 15 minutes. personalising content and ads, providing social media features and to Just two years ago, USDTs market cap was a mere $4 billion. Which countries have embraced a 4-day workweek and hows it going. Now onto the crypto context, if you have not guess it already, Tether's USDT that tracks the value of the US dollar is backed by a significant amount of Chinese commercial paper. As we have indicated in our published statements and our most recent assurance attestation with a reporting date of June 30, 2021, the vast majority of the commercial paper held by Tether is in A-2 and above rated issuers.. Cramer said his crypto concerns right now begin with tether, a stablecoin that's pegged to the U.S. dollar. Chinas loose and reactive (at best) financial regulatory environment is one reason anxiety around Tether has largely centered on whether it holds Chinese commercial paper in general not just whether it holds Evergrandes. According to the attorney-generals investigation, there were instances when Tether was not fully backed in the past. The downgrade from A to AA applies both to the bonds and their issuer rating. "The vast majority of the commercial paper held by Tether is . Neither Tether nor Bitfinex admitted wrongdoing. And despite it seeming as though the stablecoins are in competition, Ardoino believes this will be key to success with regulators. A Division of NBCUniversal. Tether has revealed that its commercial paper holdings would be $3.5 billion by July 31. Which countries in the EU are buying the most electric cars? Hit him up! The developer on Thursday applied to suspend trading of that unit's onshore corporate bonds following a downgrade, which market participants said indicated an increasing likelihood of defaults and restructuring. clarified that Tether does not hold Evergrande's commercial paper. We are completely confident.". In early 2021, Tether paid a fine of $18.5 million to settle a case with the New York Attorney General. A government bailout is also a possibility. "The case is you have two choices, you trust the rating agencies, or you don't trust them. Evergrande is trying to find a way to cut costs and sell off some of its assets to dig its way out. "Don't let it become a loss. analyse how our Sites are used. The US Treasury is expected to release an in-depth report on stablecoins any day now. document.write(''); Stablecoin Tether says it does not hold any commercial paper from Evergrande in recent a statement. Commercial paper is a form of unsecured, short-term debt issued by companies that doesn't need to be registered with the Securities and Exchange Commission (SEC) as long as it matures before nine months. Tether, the largest stablecoin, is a Hong-Kong based stable currency. The information on this website is subject to change without notice. This story was seen first on BeInCrypto Join our Telegram Group and get trading signals, a free trading course and more stories like this on BeInCrypto, Ukraine Latest: Russia Continues Efforts to Encircle Bakhmut, INSIGHT-Before fatal collapse, Turkish building had skirted code thanks to Erdogan policy, In Chicago, adapting electric buses to winters challenges, Ukraine ally Kallas fights for reelection in Estonia vote, Global race to boost electric vehicle range in cold weather. How Ethereum's evolution impacts crypto markets. Evergrande is the biggest issuer of commercial papers. Evergrande is the biggest issuer of commercial paper in the Chinese real estate market, according to Reuters. "I know the crypto-lovers never want to hear me say sell, but if you've got a big gain as I did, well, I'm begging you to," the "Mad Money" host said. Its been going on for a long time one analyst who warned about Evergrandes practices as early as 2012 was temporarily banned from Hong Kong markets by regulators for his reckless claims. "So Tether is extremely glad that there is a USDC, that there is Paxos and all the other stablecoins, because that is how we become an industry.". Hundreds of customers have protested in front of the companys offices alleging mistreatment or fraud. News and analysis for the professional investor. Tether had stated since its launch in 2014 that its tokens were fully backed by US dollars in bank accounts, before pivoting in February 2019 to say that its reserves included traditional currency, cash equivalents and other assets and receivables. But he did lay out his timeline expectations for regulation. promo Many stablecoin companies have followed Tether's lead both with attestation and the use of commercial paper. As a result, even though Tether says it doesn't hold commercial paper issued by Evergrande, an upheaval in the commercial paper market could still have wider . As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. Consider this - most of the reserve assets Tether holds to support its USDT are commercial papers (CPs) and certificate of deposits (CDs) instead of the US dollar. Investors aren't only looking at audits, there's also regulation. "Right now, owning crypto is what's known as a 'crowded' trade and I don't want you to lose money if this space keeps getting hit by Evergrande's contagion worries," he said. Stablecoin Tether clarified that while they do hold commercial paper, none of it is from Evergrande. "The only interest of Tether is maintaining a liquid and extremely safe portfolio," he said. But it could still take Tether with it, depending on whats actually in that stablecoin sandwich. "The vast majority of the commercial paper held by Tether is in A-2 and above rated issuers.". The struggling real estate giant has listed $300 billion in total liabilities and says it needs to find funds quickly. Bitcoin and other cryptocurrencies were crashing Monday amid a global selloff in risk assets. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. How Ethereum's evolution impacts crypto markets. The transformation of value in the digital age. What financial advisors need to know about crypto. Probing the intersection of crypto and government. In a series of tweets about the Evergrande news, partner at Cinnemhian Ventures Adam Cochran, said that IF either Tether or USDC did meltdown in a global collapse though, itd actually be bullish for crypto, as if you couldnt use them to cash out, people would just start bulk converting them into BTC/ETH regardless of price., Cochran added that, despite not being a well-known name in the West, the failure of Evergrande could have massive fallout. Commercial paper typically has low default rates. ; ; Vergleich; ; ; ; By signing up, you will receive emails about CoinDesk product updates, events and marketing and you agree to our, Bankman-Fried Should Have Only Flip Phone, Website Whitelist, DOJ Says, With Congress Impotent, Courts Are the Only Option for Fighting SEC Overreach, Silvergate Closes SEN Platform Institutions Used to Move Money to Crypto Exchanges, Binance.US Is Operating 'Unregistered Securities Exchange,' SEC Official Says, About half of Tethers roughly $75 billion in assets, Tether (the company) said back in September.