Tether International Ltd., the company behind the third-largest cryptocurrency by market value, will use 15% of its net investment profit, equivalent to $222 million of its first-quarter profit, on Bitcoin to diversify reserves backing its USDT stablecoin.
- The issuer of the world’s largest stablecoin will add to its $1.5 billion BTC reserves.
- Tether started making a profit from operations in February of this year.
- The Bitcoin allocation will amount to over $200 million based on a recent profit.
Tether was fined by U.S. regulators in 2021 for misrepresenting reserves backing its stablecoin meant to keep it at 1:1 to the U.S. dollar. The company, which said last week that its assets total $81.1 billion, said most of that was in the form of Treasury bills, and that 85% of its assets were “extremely liquid” in cash and cash equivalents. Gold and Bitcoin accounted for about 4% and 2% of Tether’s total reserves, respectively.
Tether said it doesn’t expect its Bitcoin holdings to exceed its share capital cushion—reserves in excess of the customer liabilities…