Tether wants to back USDT by buying Bitcoin

Per CNBC

Tether, the crypto giant behind USDT, the most popular stablecoin, said that it would be buying Bitcoin to back its stablecoin. The amount that they would spend is roughly around $222 million.

For those that don't know, USDT isn't just the most popular but also the largest stablecoin in the market, with a circulating supply of over 82.8 billion per CoinGecko. As of press time, the site also shows that the stablecoin has a $83 billion market cap.

The company said that it wanted to diversify, and to do this, it would place 15% of its net profits into Bitcoin. The diversification efforts come as Tether is trying to back its USDT token.

The USDT token, like other stablecoins, aims to stick to the value of the US dollar, which would ideally make it a 1:1.

A Tether spokesperson gave a statement about their decision to diversify and clarified that its Bitcoin purchase wouldn't take up a huge part of its overall net profit. Most of the excess income that Tether incurs was reportedly spent on banking fees and other things related to business expenses.

“The aim is to keep the Bitcoin portfolio value well below the size of our total excess reserves that accounted for 2.48B at the end of Q1/2023, while bitcoin holdings accounted for 1.5B,”

In December, Coinbased encouraged its users to abandon USDT for USDC. To do this, the platform said that they would be covering their conversion fees, meaning all expenses from switching stablecoins would be waived.

This was due to the previous scrutiny on Tether, with questions being asked as to whether it was really backed 1:1.

In March, Circle of USDC said it had $3.3 billion of its $40 billion USDC reserves stored at Silicon Valley Bank.

See flow at unusualwhales.com/flow.

Other News:

Resources:

CNBC

CoinGecko

tastytrade logo+
Get the best broker for options trading and earn Unusual Whales discounted! in cash with an eligible account deposit at tastytrade. Get an Unusual Whales bonus when you deposit $2000. Offer expires 3/31/25. Certain restrictions, terms and conditions apply.
Unusual Whales does not confirm the information's truthfulness or accuracy of the associated references, data, and cannot verify any of the information. Any content on this site or related pages are not intended to provide legal, tax, investment or insurance advice. Unusual Whales Inc. is not registered as a securities broker-dealer or an investment adviser with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority (“FINRA”) or any state securities regulatory authority. Nothing on Unusual Whales should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security by Unusual Whales or any third party. Options, investing, trading is risky, and losses are more expected than profits. Please do own research before investing. Please only subscribe after reading our full terms and understanding options and the market, and the inherent risks of trading. It is highly recommended not to trade on this, or any, information from Unusual Whales. Markets are risky, and you will likely lose some or all of your capital. Please check our terms for full details.
Any content on this site or related pages are not intended to provide legal, tax, investment or insurance advice. Unusual Whales Inc. is not registered as a securities broker-dealer or an investment adviser with the U.S. Securities and Exchange Commission, the Financial Industry Regulatory Authority (“FINRA”) or any state securities regulatory authority. Nothing on Unusual Whales should be construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any security by Unusual Whales or any third party. Certain investment planning tools available on Unusual Whales may provide general investment education based on your input. You are solely responsible for determining whether any investment, investment strategy, security or related transaction is appropriate for you based on your personal investment objectives, financial circumstances and risk tolerance. You should consult your legal or tax professional regarding your specific situation. See terms for more information.