Tether’s Commitment to Transparency: Real-Time Reserve Data Release Planned for 2024
Tether, the issuer of the world’s largest stablecoin by market capitalization, Tether (USDT), has announced its commitment to enhance transparency by planning to provide real-time updates of its reserve data starting in 2024, according to a report by Bloomberg.
This move underscores the company’s efforts to address concerns surrounding the stability and transparency of the widely-used USDT stablecoin, which has been under scrutiny regarding the backing of its reserves.
As of now, Tether already discloses its reserve data on a regular basis, including daily and monthly updates, as well as quarterly reserve reviews. The decision to transition to real-time reserve data reporting represents a significant leap towards further transparency.
Tether’s stablecoin issuance has seen significant growth over the past year, making it a systemically important entity within the cryptocurrency space. It holds nearly 70% of the total stablecoin market capitalization, making it imperative for the company to provide transparent insights into its reserve holdings that support USDT.
The recent quarterly attestation revealed that Tether holds $3.3 billion in excess reserves, with a substantial portion in US Treasuries, amounting to $72 billion. This positions Tether as the 22nd largest holder of US debt, surpassing some countries in the process. Tether’s shift in its collateral composition has reduced exposure to riskier assets, such as commercial paper, in favor of primarily backing USDT with Treasuries.
The need for real-time reporting comes in the wake of a $40 million settlement Tether paid in response to regulatory allegations of providing false information about its reserves. By embracing more frequent, live data releases, Tether aims to rebuild trust within the cryptocurrency community and meet the growing demand for greater transparency in the stablecoin market. This commitment to transparency aims to reassure both investors and regulators about the stability and legitimacy of USDT.
While this planned move is a positive step for Tether and the cryptocurrency industry as a whole, it is worth noting that Tether has not set a specific deadline to achieve real-time data reporting, as highlighted in a recent article update. We anticipate further developments on this front as the cryptocurrency market continues to evolve and address regulatory concerns regarding stablecoin operations.