It turned out that Tether, the issuer of the largest stablecoin USDT by market capitalization, made large withdrawals from bank deposits in the first quarter of the year.
According to the latest balance sheet report, while the company's assets worth $5.3 billion were in bank accounts at the beginning of the year, this item decreased to $481 million at the end of the first quarter.
Explaining the situation to the crypto press, Tether officials emphasized that although they distribute the risk to different banks, they minimized their deposit accounts in order not to be affected by bankruptcies. Although it is not known which banks the stablecoin issuer prefers, their action before the crisis has earned the appreciation of crypto investors.
Where are the deposits used?
The US-based stablecoin issuer did not hold the $4.8 billion deposits it had withdrawn from the bank in cash. With the money withdrawn, Tether bought US Treasury Bonds with different maturities. According to the balance sheet report, $7.5 billion of assets of the USDT issuer are in overnight repos. In this way, the company earns some passive income by giving very short-term loans.
In March, it was revealed that another stablecoin issuer, Circle, had deposits of $3.3 billion in bankrupt Silicon Valley Bank. After the news, the USDC token lost its stability to 1 dollar for a while.
