Tether Maintains $3.3B Liquidity Buffer to Uphold USDT Stability


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Tether, the issuer of the USDT stablecoin, has made public its practice of maintaining a substantial $3.3 billion liquidity buffer. This strategic measure serves a twofold purpose which is, to uphold stability within the USDT ecosystem and secondly, to nurture unwavering trust among its diverse stakeholders.

However, the disclosure of this liquidity buffer underscores Tether’s commitment to maintaining the value and reliability of USDT. Overall the company holds assets of about $86.1 billion, and its liabilities totaling $82.8 billion, which indicates a reserve backing of over 100%. Meanwhile, this recent figure is slightly lower than the consolidated total assets held by the company in June, which amounted to about $86.5 billion.

As per Tether’s recent reserves report, the company holds a $3.29 billion shareholder capital cushion across 15 different blockchain ecosystems. Notably, Tether has the capability and authorization to issue USDT tokens in large quantities.

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Tether Committed to Ensure Stability of USDT

Additionally, the $3.3 billion liquidity buffer can be seen as a testament to Tether’s dedication to its role as a cornerstone within the cryptocurrency ecosystem.

As one of the most widely used stablecoins, USDT plays a pivotal role in facilitating trading and transactions across numerous cryptocurrency exchanges. Ensuring its stability is not only essential for Tether’s reputation but also for the broader functioning of the digital asset landscape.

Moreover, regulators, investors, and users alike have been advocating for clearer insights into the operations and reserves of stablecoin issuers.

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US Lawsuit Question USDT Reserve Composition

Recall that a lawsuit was filed by Matthew Anderson and Shawn Dolifka against Tether Holdings in December 2021. The plaintiffs alleged that Tether’s USDT backing claims were unfounded and that the stablecoin issuer failed to maintain the same amount of reserves as Tether tokens in circulation.

Furthermore, the lawsuit argued that these reserves comprised other assets including over-collateralized loans and undisclosed commercial papers. In its defense, Tether said it has consistently maintained a 1:1 pegging.

Profit Soars Despite Industry Challenge

Interestingly, Tether earned approximately $700 million in profit at the end of last year, despite the massive damage that the crypto industry took last year, as well as the bankruptcy of some crypto exchanges. According to the blockchain-enabled platform, the profit earned made the value of its consolidated assets exceed the total of the consolidated liabilities.

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