A new report from Tether has revealed that the blockchain network has reduced its exposure in commercial paper holdings by over 58% over the previous quarter. Tether’s commercial paper holdings have dropped from $20 billion to $8.5 billion.
Commercial papers are short-term unsecured debt securities issued by corporations. Following the crash of the Terra Network and the failure of Terra USD (UST), there were growing concerns about the nature of Tether’s holdings in commercial papers and its exposure to Chinese commercial papers.
Tether plans to reduce the exposure to commercial papers to zero by the end of this year. During the same period, Tether increased its cash holdings and bank deposits by 32%.
The report, issued on Friday, though was meant to primarily assure the market that Tether’s stablecoin (USDT) is backed by 100% real assets. It presents the results of Tether’s quarterly assurance opinion—a review involving an assessment of processes, procedures, and operations of the stablecoin issuer. The review was conducted by BDO Italia, a major Italian accounting firm.
According to the report, as of 30 June 2022, Tether’s total assets amount to $66.40 billion. Of this, $28.9 billion is in treasury bills, $8.4 billion in commercial paper and certificates of deposit, $6.8 billion in money market funds, $5.4 billion in cash and bank deposits, $2.9 billion in reverse repurchase agreements, and the remaining in other types of securities.