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Tether’s Bank announces It Invests Customer credits in Bitcoin

  • Posted On - 2021-01-19 04:57:57

Deltec, Tether’s Bahamas-based bank, proclaimed that they have been investing client funds in bitcoin.

The announcement, made by Deltec Bank & Trust Chief Investment Officer Hugo Rogers during a year-in-review video, raises new questions about whether or not the dollar-pegged USDT stablecoin, that is in theory backed by cash and “cash equivalents,” as well as “other assets and assets created by loans,” is truly backed in any manner by bitcoin.

“We bought bitcoin for our clients at approximately $9,300 so that worked okay through 2020 and we expect it to continue operating well in 2021 because the printing presses are still running hot,” Rogers said within the video.

Twitter user @lenne0816 seems to have been the primary to surface the video, that was posted online on 13th January.

Through a representative, Tether general counsel Stuart Hoegner confirmed that Deltec remains the stablecoin issuer’s bank.

Deltec created headlines in 2018 after Tether published a letter from the bank asserting that it commanded a bit over $1.8 billion, that roughly lined up with the quantity of USDT in circulation at the time.

A Deltec govt later confirmed that the letter, that was unsigned, was authentic.

The next year, the New York Attorney General’s workplace discovered that Bitfinex, Tether’s sister company through shared possession and executives, had lost on the point of $1 billion once its payment processors’ bank accounts were frozen and funds seized. Bitfinex had been covering up the losses by borrowing from Tether’s reserves, which are meant to back the stablecoins which are in circulation.

The companies are presently under associate degree injunction to stop from now on loan activities between themselves, though this injunction is about to expire on January 15.

Tether issuing has been on a tear since the injunction was 1st bimanual down and $25 billion in USDT are presently in circulation. Bitcoin’s value, that some lecturers and investors maintain is buoyed by USDT issuing, has broken new highs, rising past $40,000 per coin similarly in recent months.