Tether, the company behind USDT, crypto’s largest stablecoin with a market capitalization of $69B, has completely eliminated commercial paper from its reserves.
The company now holds the majority of its reserve assets in U.S. Treasury Bills. T-Bills are short-term U.S. government debt obligations backed by the Treasury Department with a maturity of one year or less.
The move has been in the works for some time, as the company slashed its commercial paper holdings by 58% in the second quarter.
USDT is a stablecoin backed 1:1 by fiat dollars, but its reserves have been called into question many times over the years, including by the office of the New York Attorney General (NYAG). By getting rid of commercial paper in favor of less-risky T-Bills, the company is undoubtedly looking to assuage any lingering doubts.
In August, Tether drew praise from the crypto community after it said that it will not freeze any addresses which hold its dollar-pegged asset until specifically asked to do so by law enforcement.
It took this stand in the wake of the Tornado Cash sanctions while competitor Circle, the issuer of the USDC stablecoin, chose to ban 38 addresses.