Details of Tether’s USDT reserve ── US CoinDesk obtained after two years of trial based on the Information Disclosure Act | CoinDesk JAPAN | CoinDesk Japan


As of March 2021, stablecoin issuer Tether has funds in four banks, two investment management firms, two gold depositaries and gold brokers, and sister company Bitfinex. was stored. Documents obtained by CoinDesk revealed.

It also holds commercial paper (CP) and securities issued by various entities. Issuers include, for example, Qatar National Bank, Barclays Bank, Deutsche Bank, Emirates NBD Bank, NatWest Group, but mostly various banks and financial institutions in China.

It is well known that Tether previously invested its reserves in CP. The company has confirmed it has invested in CP in 2021. However, it was not clear until now how much was invested.

Agricultural Bank of China, Bank of China (Hong Kong), Bank of Communications, Industrial and Commercial Bank of China, Merchants Bank, China Construction Bank, China Everbright Bank, etc. issued CP and securities, and Tether invested as backing assets for tokens.

As of March 31, 2021, Tether held more than $35.5 billion worth of these financial institutions, according to the documents. The documents were presented to CoinDesk by the New York State Attorney General’s Office (NYAG) in response to a state Freedom of Information Act request filed in June 2021. The document appears to have been created on August 4th, 2021 and reflects the inner workings of Tether at the time. An additional $5.1 billion is listed as “USDT loans” and other assets, bringing the total assets to $40.6 billion. This is roughly equivalent to USDT’s $40.8 billion in circulation at the time.

*Editor’s Note: This article is based on documents received via a Freedom of Information Act request to the New York Attorney General’s Office. Some documents have been re-edited to protect personal information.

The documents provide limited but valuable information about Tether’s reserves, which have long been the subject of debate and speculation in the cryptocurrency industry. When New York State Attorney General Letitia James announced the settlement with Tether in February 2021, the Attorney General said that USDT, the stablecoin issued by Tether in 2017 and 2018, was not fully backed. He says there was a time when he didn’t. The document, drawn up six months after the NYAG settlement, neither proves nor disproves that claim.

However, the question of where Tether stores the underlying assets provided a clue. For many years, information about Tether’s banking relationships was patchy.

USDT is the No. 1 stablecoin in terms of market capitalization and plays an important role as a means of trading on cryptocurrency exchanges. USDT is designed to be pegged to the U.S. dollar, and Tether claims to have a reserve of at least the same amount of USDT in circulation.

The company has long been plagued by suspicions that USDT is not fully backed, but in April 2019, the New York State Attorney General’s office announced that Tether had acquired shares of the board of directors and parent company of exchange BitFi. Those concerns seemed clear when it announced it had lent about $850 million to Bitfinex.

At that time, Tether published the first document showing the breakdown of its reserves, nearly half of which was commercial paper (CP). Under the Freedom of Information Act, CoinDesk has requested documents detailing USDT’s backing assets.

When it announced its settlement with NYAG in 2021, Tether said it would make information about its reserves public for at least two years. The first release was in May 2021, with just two pie charts and a brief statement.

A report on portfolios dated April 7, 2021 in the document released this time contains a similar pie chart, but with much more information and specifics on Tether’s reserves. A detailed breakdown is shown. The information regarding term deposits has been partially redacted, but we know that Tether held millions of dollars in reserves in certificates of deposit, bonds, and especially commercial paper.

According to documents dated June 4, 2021, Tether also held funds in Ansbacher in the Bahamas, Capital Union Bank and Far Eastern International Bank in Taiwan, but mostly in the Bahamas. Deposited at Deltec Bank and Trust, based in As of March of that year, it was more than $26 billion.

According to CoinGecko, as of 22:30 ET on March 31, 2021, USDT worth $40.8 billion was in circulation.

The document details the assets held by each financial institution, confirming that Tether held a substantial amount of its reserves in commercial paper.

A separate report published by Ansbacher provided more details, stating that about 85% of Tether’s assets entrusted to Ansbacher were commercial paper. The bulk of the rest, 13.7%, was corporate bonds, and the rest were high yield bonds, floating rate bonds and credit accounts.

A similar report issued by Capital Union Bank lists about 88% as “liquid assets” but does not provide a breakdown.

Some of these documents describe correspondence between the company’s legal team and the NYAG shortly after it settled with the NYAG.

NYAG had doubts about its commercial paper holdings after the settlement, according to one of them.

CoinDesk obtained the documents in February following a nearly two-year trial.

Prior to the publication of this article, Tether released a statement confirming that the NYAG released the documents. A statement issued on June 16 said:

“Tether has initiated procedures to prevent sensitive customer data from being exposed and to prevent the potential misuse of sensitive business information by malicious actors.”

“But our continued and clear commitment to transparency is more open than time-wasting, unproductive American litigation that distracts from the real issues facing our communities. It shows that it is a priority.”

CoinDesk has sent detailed questions about the document to Tether, but has not received a response as of this writing.

In a statement, Tether also said that on the “same day” that NYAG released the document to CoinDesk, a decentralized finance (DeFi) pool sold millions of dollars worth of USDT, temporarily losing its dollar linkage. “I was suspicious,” he said.

In fact, USDT temporarily lost its dollar linkage before 7:00 UTC on the 15th. That was at least five hours before NYAG representatives handed over the documents to CoinDesk lawyers.

CoinDesk was informed by a lawyer on June 12th that Tether will finally receive the document after a lengthy trial intended to prevent it from being made public. We didn’t share the release of the document with anyone other than the editorial staff until we received it in New York on the morning of June 15, hours after the USDT lost its dollar peg. US CoinDesk stands by the integrity of our reporting.

|Translation: coindesk JAPAN
|Editing: Takayuki Masuda
|Image: Shutterstock
|Original: Tether’s Banking Relationships, Commercial Paper Exposure Detailed in Newly Released Legal Documents

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