This article is excerpted from The Node, CoinDesks daily roundup of the most pivotal stories in blockchain and crypto news. "Tether has maintained its stability . Chinas loose and reactive (at best) financial regulatory environment is one reason anxiety around Tether has largely centered on whether it holds Chinese commercial paper in general not just whether it holds Evergrandes. Evergrande's main unit had 205.7 billion yuan ($32 billion) worth of commercial paper at the end of 2020, filings show. Tether, the world's largest 'stablecoin', said in a statement it does not hold any commercial paper or securities issued by embattled developer China Evergrande Group, as regulatory scrutiny into risks from this type of token grow. How the biggest companies plan mass lay-offs, The benefits of revealing neurodiversity in the workplace, Tim Peake: I do not see us having a problem getting to Mars, Michelle Yeoh: Finally we are being seen, Our ski trip made me question my life choices, Apocalypse then: lessons from history in tackling climate shocks, Stablecoins: bitcoin for squares has its own downsides. Tether Denies Holding Commercial Paper Issued by Troubled - NXTmine Your Use of the Site. The US Office of the Comptroller of the Currency has released guidance saying that banks can take deposits from stablecoin issuers only if the coins are fully backed by reserves. Approximately half of Tether's $62.8 billion assets as of the end of June 2021, were backed by commercial paper and certificates of deposit, according to the company. Among other signs of serious mismanagement, customers have made large deposits on Evergrande apartments that were never built. The developer on Thursday applied to suspend trading of that unit's onshore corporate bonds following a downgrade, which market participants said indicated an increasing likelihood of defaults and restructuring. read more. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. Sell some, stay long the rest, then let's wait and see if China changes its attitude toward an Evergrande bailout.". different direction, choosing to only use cash reserves and cash equivalents, US Treasury is expected to release an in-depth report on stablecoins. This license does not include nor permit your resale or commercial use of the Site or its contents. The information on this website is subject to change without notice. The developer on Thursday applied to suspend trading of that unit's. A wave of smaller stock frauds from 2010-2016 were chronicled in the documentary The China Hustle, and Luckin Coffee put an exclamation point on the trend in 2019. Tether said that it funnelled roughly half its reserves into commercial paper. Data is a real-time snapshot *Data is delayed at least 15 minutes. Tether is the third-largest cryptocurrency by market value, trailing only ether and bitcoin, which are second and first, respectively. ConsenSys to Launch zkEVM Testnet as Battle for ZK Supremacy Heats Up, Binance Continues to Battle FUD as US Senators Go After Balance Sheets, Coinbase Moves Into More Stable World of Asset Management with Latest Acquisition, EOS Pumps 10% Amid Broader Market Correction due to EVM Speculation. Those questions can only be answered with a little more transparency from the stablecoins issuer. Evergrande was successful in raising around $8 billion by August, according to a report from Bloomberg, but it is just a drop in the pan compared to what it still owes. The "Mad Money" host said the struggles of Chinese developer Evergrande are likely to keep weighing on crypto markets. Stablecoin Tether says holds no Evergrande commercial paper For critics of Tether, the new economy of digital assets is based on the worlds oldest profession: real estate speculation. The biggest crypto news and ideas of the day. Ardoino wouldn't comment on whether the Treasury directly spoke to Tether for the report. As one of the first stablecoins, Tether's experienced its fair share of controversies, particularly surrounding the reserves that back its eponymous coin. Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Head to consensus.coindesk.com to register and buy your pass now. ; ; Vergleich; ; ; ; It is now the third-largest cryptocurrency by market capitalisation, according to CoinMarketCap, making up the bulk of stablecoin volume. Evergrande, China's second-largest property developer, is to blame. We believe that our disclosures thus far prove that all tethers are fully backed with very useful disclosures about the nature of that backing, he added. 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New Tether Report Shows 17% Reduction in Commercial Paper It earned this title after the Chinese government banned the company from issuing longer-term debt. Commercial paper is a form of unsecured, short-term debt issued by companies that doesn't need to be registered with the Securities and Exchange Commission (SEC) as long as it matures before nine months. Decentral Media, Inc. is not an investment advisor. Cramer has a position in ether, which runs on the Ethereum blockchain. Though its main product since its founding in the 1990s has been housing, Evergrande has grown into a huge conglomerate with products ranging from bottled water to electric cars to a soccer team. Hit him up! But since it's unsecured, there is also very little recourse for investors if an issuer does default. In February, the operator and the related trading platform Bitfinex pledged to offer more transparency on its reserves under the terms of an $18.5m settlement with the New York attorney-generals office, leading to the most recent disclosures last month. I think one time, Stanley mentioned when he saw employees on downtime he . Cash made up only 2.9 per cent, according to the companys disclosure. Evergrande is trying to find a way to cut costs and sell off some of its assets to dig its way out. However, Tether is very secretive about its holdings, only disclosing that it does hold international commercial paper. Is the Evergrande crisis pushing Bitcoin, Tether markets on - AMBCrypto A report from the end of 2020 shows that Evergrande has just around 10% of the money owed. "If tether collapsed, well, then it's going to gut the whole crypto ecosystem," he said. Sign up for Crypto for Advisors, our weekly newsletter defining crypto, digital assets and the future of finance. This is not the first time concerns about the true value of USDT have emerged. The US Treasury is expected to release an in-depth report on stablecoins any day now. The developer on Thursday applied to suspend trading of that unit's. Tether's commercial paper disclosure places it among global giants "So if you own crypto in any form and you've got big gains, I recommend taking something off the table.". Tether Claims to Hold no Commercial Paper From Struggling Evergrande Is Evergrande's Fall Influencing the Depeg Issue for Tether? Find company research, competitor information, contact details & financial data for Tether, Inc. of Seattle, WA. We do not give personalized investment advice or other financial advice. In a blog post a few days after its reserves report was released, Hoegner said the commercial paper that the company held was purchased through recognised issuance programmes, the vast majority highly rated, and that there were limits on individual issuers and regional exposures. The biggest crypto news and ideas of the day. Neither Tether nor Bitfinex admitted wrongdoing. Elon Musks Twitter is dying a slow and tedious death. By signing up, you will receive emails about CoinDesk products and you agree to ourterms & conditionsandprivacy policy. Such holdings of companies short-term debt would make it the seventh largest in the world. The stablecoin issuer says its goal is to reduce its commercial paper holdings to zero. Work - Tether Critics say it's not enough. Join our Telegram Group and get trading signals, a free trading course and daily communication with crypto fans! read more. He said that the New York attorney-general had no clear findings that customers at any point were at risk of being unable to redeem tethers because of a lack of backing. In an interview, stablecoin Tether's tech chief Paolo Ardoino lays out the case for holding commercial paper in its reserves. "While old information about Tether's reserves and so on is public, it keeps growing," Ardoino said. Screen for heightened risk individual and entities globally to help uncover hidden risks in business relationships and human networks. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities. CoinDesk journalists are not allowed to purchase stock outright in DCG. A commercial paper report from Evergrande at the end of 2021 showed its main unit had $32 billion, just around 10% of its total liabilities. The stablecoin issuer Tether this week declared that it doesnt hold short-term debt issued by troubled Chinese real estate developer Evergrande. Evergrande's main unit had 205.7 billion yuan ($32 billion) worth of commercial paper at the end of 2020, filings show. The latest moves in crypto markets, in context. Cramer said his crypto concerns right now begin with tether, a stablecoin that's pegged to the U.S. dollar. Build the strongest argument relying on authoritative content, attorney-editor expertise, and industry defining technology. Mad Money Twitter - Jim Cramer Twitter - Facebook - Instagram, Questions, comments, suggestions for the "Mad Money" website? USDT leads the stablecoin market by trading volume and acts as the top base-pair currency for trading across several large crypto exchanges, including Binance, FTX, and others. Hoegner said the commercial paper reserves included amounts held internationally with further sub-custody at major global institutions. Stablecoin Tether says holds no Evergrande commercial paper He also said that Tether did not hold any commercial paper issued by cryptocurrency exchanges or affiliated entities. News and analysis for the professional investor. Tether does not hold any commercial paper or other debt or securities issued by Evergrande and has never done so, the company said. 2023 CNBC LLC. Something weird happened today in crypto-world. Tether: hat 50 % der USDT-Reserven in Commercial Paper-Bestnden He is also now CTO of cryptocurrency exchange Bitfinex. But this is not just about one company: Even if Tether doesnt specifically hold any of Evergrandes short-term debt, it could have huge exposure in the form of other Chinese obligations. That has included harshly curtailing apparently successful fintech firms like Ant Group and, most recently, instituting restrictions on video games, which cant be good for Tencent and other firms. Tether has amply demonstrated, most recently through assurance opinions from [auditor] Moore Cayman, that all issued tethers are, in fact, fully reserved, he added. The most comprehensive solution to manage all your complex and ever-expanding tax and compliance needs. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. You will receive a link to create a new password via email. var absrc = 'https://servedbyadbutler.com/adserve/;ID=177750;size=0x0;setID=588602;type=js;sw='+screen.width+';sh='+screen.height+';spr='+window.devicePixelRatio+';kw='+abkw+';pid='+pid588602+';place='+(plc588602++)+';rnd='+rnd+';click=CLICK_MACRO_PLACEHOLDER'; In those two years, bitcoins market cap has gone up eight times, from $159 billion to $1.3 trillion. It seems increasingly likely that Evergrande is fated instead for the glue factory. Investors aren't only looking at audits, there's also regulation. NOW WATCH: WATCH: How any business can use live shopping to net thousands of dollars per stream, said every tether coin was fully backed by US dollars in bank accounts. The vast majority of the commercial paper held by Tether is in A-2 and above rated issuers.. Meanwhile, based on data from the Peoples Bank of China, Chinese commercial paper ended Q2 in 2021 at around $900 billion, up from just shy of $700 billion that same quarter in 2019, a gain of less than a third. var rnd = window.rnd || Math.floor(Math.random()*10e6); The report revealed that the stablecoin company also provided a billion-dollar loan to Celsius, a centralized crypto lending platform that was recently accused of violating securities laws by the U.S. States of Alabama, Texas, and New Jersey. Approximately half of Tether's $62.8 billion assets as of the end of June 2021, were backed by commercial paper and certificates of deposit, according to the company. The enshittification of apps is real. It expanded by borrowing aggressively, including during periods when Chinas economic outlook was seen in much rosier terms globally than it is now. The systematic suppression that characterizes Chinese markets adds an opaque but potentially huge risk for the holders of any Chinese asset even if that risk is wrapped up in a supposed stablecoin. Stablecoin Tether clarified that while they do hold commercial paper, none of it is from Evergrande. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. Polygon (MATIC) Price Dropped 9% in One Day so Wheres It Headed Next? Evergrande is just the latest major Chinese firm to have serious problems due to apparent fraud or mismanagement. Contact - Tether "An industry is not an industry if there is only one player, instead having many players with different offerings with different use cases is really helpful in a moment when you have to talk with the regulator," Ardoino said. The tumble appears to have been triggered by the mounting problems at embattled property giant China. Cramer says take crypto profits, cites Evergrande-related tether - CNBC These frauds even show some sign of being tacitly approved by the Chinese government, to the extent that they have targeted investors abroad. But he did lay out his timeline expectations for regulation. Join the most important conversation in crypto and Web3 taking place in Austin, Texas, April 26-28. This story was seen first on BeInCrypto Join our Telegram Group and get trading signals, a free trading course and more stories like this on BeInCrypto, Ukraine Latest: Russia Continues Efforts to Encircle Bakhmut, INSIGHT-Before fatal collapse, Turkish building had skirted code thanks to Erdogan policy, In Chicago, adapting electric buses to winters challenges, Ukraine ally Kallas fights for reelection in Estonia vote, Global race to boost electric vehicle range in cold weather. Its flagship unit, Evergrande Real Estate Group, had 205.7 billion yuan ($32 billion) worth of commercial paper at the end of 2020,. Tether, Bitcoin and Chinese Commercial Paper at Scale Its been going on for a long time one analyst who warned about Evergrandes practices as early as 2012 was temporarily banned from Hong Kong markets by regulators for his reckless claims. This was later repaid by Bitfinex. The company has more than $300 billion in total liabilities and recently warned investors it may default on its debts. All quotes delayed a minimum of 15 minutes. As a result, even though Tether says it doesn't hold commercial paper issued by Evergrande, an upheaval in the commercial paper market could still have wider . Stablecoin Tether says holds no Evergrande commercial paper Evergrande has now had to suspend trading of. Tether is completely unbacked USD that gives these exchanges the liquidity they need to market make derivatives that have non-linear . var abkw = window.abkw || ''; Approximately half of Tether's $62.8 billion assets as of the end of June 2021, were backed by commercial paper and certificates of deposit, according to the company. Tether still expects to be the first to secure an external financial statement audit, which it has been exploring since 2017, but it won't necessarily be from one of the Big Four accountants. What financial advisors need to know about crypto. "Don't let it become a loss. How Ethereum's evolution impacts crypto markets. Learn more about Consensus 2023, CoinDesks longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Tether has become one of the most important components of the cryptocurrency ecosystem, with more than 35bn tethers printed so far this year, more than double its supply in January. Stablecoin Tether says holds no Evergrande commercial paper - Yahoo! But Stuart Hoegner, Tethers general counsel, said: With respect to reputation, we believe we are seeing the opposite: more and more counterparties are comfortable with Tether and our transparency initiatives and are keen to work with us.. In the NYAG investigation, the company was found to be conducting illegal activities in New York. and other data for a number of reasons, such as keeping FT Sites reliable and secure, But these are the same rating agencies that are rating the US Treasuries," Ardoino said. Before falling into a major crisis, Chinese property developers had issued commercial paper worth 3.6 trillion yuan ($556 billion) in 202020% higher from 2019. Yet, does Tether truly own a lot of Chinese commercial paper? HONGKONG Tether, the worlds largest stablecoin, said in a statement it does not hold any commercial paper or securities issued by embattled developer China Evergrande Group, as regulatory scrutiny into risks from this type of token grow. Smart navigation app uses 3D sound to guide blind people. What does one have to do with the other? "The vast majority of the commercial paper held by Tether is in A-2 and above rated issuers. madcap@cnbc.com. Evergrande and China's Looming Risk to Tether - CoinDesk Reuters described Evergrande as "the biggest issuer of commercial papers". This stability means they offer an accessible - if boring - entry and exit point to the crypto world. After a couple of decades of relative freedom for entrepreneurs (including, as mentioned, the apparent freedom to commit securities fraud), Chinese leadership under Xi Jinping has begun to aggressively intervene in markets. How Ethereum's evolution impacts crypto markets. "We are working with an amazing counterparty that is extremely professional and has a deep knowledge of traditional finance and also crypto markets and the blockchain industry and so on. With Tether we are welcoming all that. Evergrande's main unit had 205.7 billion yuan ($32 billion) worth of commercial paper at the end of 2020, filings show. Tether Claims to Hold no Commercial Paper From Struggling Evergrande The downgrade from A to AA applies both to the bonds and their issuer rating. Stablecoins are rarely on the tips of investors' tongues when it comes to talking about the volatility-filled headline-grabbing crypto market. Got a confidential news tip? HONG KONG, Sept 16 (Reuters) - Tether, the world's largest 'stablecoin', said in a statement it does not hold any commercial paper or securities issued by embattled developer China Evergrande Group (3333.HK), as regulatory scrutiny into risks from this type of token grow. Approximately half of Tethers $62.8 billion assets as of the end of June 2021, were backed by commercial paper and certificates of deposit, according to the company. Tether says it doesn't hold any commercial paper issued by Evergrande The Chinese real-estate giant is facing down $300 billion in debt that it cant pay back. But it could still take Tether with it, depending on whats actually in that stablecoin sandwich. Stanley will arrange a new seating arrangement sporadically. By signing up, you will receive emails about CoinDesk products and you agree to ourterms & conditionsandprivacy policy. "But tons of Chinese businesses stand to get crushed by this fiasco, and they have Evergrande exposure, and that could spell real trouble if the dominoes fall here.". We may, but are not obligated to, update any outdated, incomplete, or inaccurate information. Tether's Paolo Ardoino on Reserves, Regulation and Evergrande "Right now, owning crypto is what's known as a 'crowded' trade and I don't want you to lose money if this space keeps getting hit by Evergrande's contagion worries," he said. That marks a significant decrease in commercial paper, from $24 billion to $20 billion in the first quarter of 2022. Tether published its first Reserves Breakdown in March 2021. A Division of NBCUniversal. Evergrande, for its part, is the largest commercial paper issuer in China's real estate market, owning some $32 billion worth of commercial paper at the end of last year. Analysis: Goldman Sachs faces hard sell for its consumer assets, Ex-Goldman banker Ng deserves 15 years in prison, US prosecutors say, Reporting by Alun John Krypto. As we have indicated in our published statements and in our most recent assurance attestation with a reporting date of June 30, 2021, the vast majority of the commercial paper held by Tether is in . Regardless of what commercial paper you hold, bonds and commercial paper would take a hit and some issuers may even fold," tweeted Adam Cochran, partner at Cinneamhain Ventures. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. In May, it provided a breakdown of these reserves, which Tether claims included just under $30bn in commercial paper, a short-dated investment similar to cash. But is it bad? Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile. Bitcoin, meanwhile, remained above all-time highs by about 5.5%. A stock exchange filing added that Evergrande was added to a watch list for possible further downgrades in the future. Your weekly wrap of Web3 news and trends. Probing the intersection of crypto and government. Head to consensus.coindesk.com to register and buy your pass now. News and analysis for the professional investor. We want to hear from you. Your Use of the Site. When Tether launched in 2014, it said every tether coin was fully backed by US dollars in bank accounts. Just two years ago, USDTs market cap was a mere $4 billion. According to Bloomberg BW, stablecoin issuer Tether has extended billions of dollars in loans to Chinese companies. Tethers are today, and have always been, fully backed by assets sufficient to cover the amount of tethers in circulation, Hoegner said of its latest disclosure. That type of heavy-handed control is at the core of Chinas conundrum as an authoritarian state trying to reap the rewards of capitalism. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. According to Reuters, around 50% of Tethers $62.8 billion in held assets at the beginning of July 2021, was backed by commercial paper and certificates of deposit. Overall, the studio has a watchful eye. Tether's market capitalization surged 357% in the last year to around $69 billion. An additional 20% reduction is to show up on the company's Q2 report. document.write('
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