Tether (USDT), a stablecoin issuer, has nearly totally reduced its commercial paper holdings, with less than $50 million in commercial paper units as of September 30, 2022, as reported by Cointelegraph.
According to Cointelegraph, Tether CTO Paolo Ardoino announced the statement in an Oct. 3 tweet, adding that Tether’s US Treasury bills now account for 58.1% of its whole portfolio, up from 43.5% on June 30.
Commercial papers are short-term financial instruments issued by firms that are frequently used to finance various business operations, but treasury bills are said to be more stable than commercial papers because investors are assured to repay at least the purchase price.
Tether announced in June that it planned to reduce commercial paper backing of USDT to “zero,” and rolled into short-maturity US Treasury notes — with the goal of strengthening the stability of its ecosystem and USDT stablecoin.
The stablecoin issuer has also sought to improve transparency on its dollar reserves and backing. Tether’s strategy to reduce its commercial paper holdings to zero by the end of 2022 is well underway, with the company reducing its reserves from 20 billion units in Q1 2022 to 8.4 billion units in Q2 2022, Cointelegraph further stated.
According to CoinGecko data, USDT is now the largest stablecoin, with a market valuation of $67.95 billion, ranking third among all digital assets.
(With insights from Cointelegraph)