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Why Tether Will Lead De-Fi
Stablecoins form the core of countless new economic tools. Tether believes that these tools will be essential to most modern economies for decades to come. They remove redundant and inefficient middlemen designed to extract value from financial transactions. Given that financial transactions are the lifeblood of an economic system, any tax on the basic unit of payment is a tax on the entire economy.
The currency of the future will return this captured value to the people. It will empower individuals to save, earn and do more.
Prioritizing risk management in growth
The past few weeks have been big moments for the industry and Tether. In the wake of the banking crises in the U.S. and Europe, Bitcoin is ready to do what it has always done — protect people’s wealth from financial system failures. However, we have also seen other stablecoins face major challenges as their reserves are concentrated in failed US banks, or become financially distressed due to poor risk management.
Contrary to Bloomberg's irresponsible reports, Tether would like to clearly reiterate that it is not working with Silvergate, Silicon Valley Bank, and Signature Bank. The title and narrative of Bloomberg's most recent article would lead the average reader to believe that this is somehow wrong.
However, several paragraphs in the Bloomberg article state: “The offshore stablecoin provider has never been sanctioned, so doing business with the company is not illegal,” according to Alma Angotti, who holds a senior enforcement role at the SEC.
After clicking on the title and reading it, even the reporter admitted that there would be no problem with Tether and Signature Bank cooperating, but it did not explain that Tether does not have an account at Signature Bank.
Shockingly, Bloomberg continues to rely on misinformation and clickbait to remain barely relevant.
After the collapse of Silicon Valley Bank, multiple stablecoins that were fully reserved and “decentralized” lost their pegs. Although most people's deposits have recovered due to the U.S. government insuring all depositors at Silicon Valley Bank, the market remains skeptical that stablecoin users can hold stablecoins that have significant jurisdictional concentration in one country or banking system (such as the U.S. dollar stablecoin). currency) risks faced.
Centralizing reserves can be a useful tool for trying to accelerate growth, but it is not suitable for a stablecoin that plays a central role in the industry due to the inevitable jurisdictional risks it carries. Tether believes that risk management takes precedence over artificially rapid growth. We want our competition to improve their risk management and reliability, as it is vital that the stablecoin industry remains diverse and competitive.
Tether, which held a market-leading position throughout 2023, added about $6 billion in market value in just a few weeks after Silicon Valley Bank failed.
As a result, Tether's rivals face a sharp drop in market capitalization as users redeem their holdings.
Likewise, while Tether has consistently outpaced its competitors in terms of transaction volume, this trend has continued even amid heightened volatility. This is notable because during asset crises, transaction volumes can actually increase as users rush to swap assets for other assets that are considered safer.
These trends could signal a shift in market preference for stablecoins. If these trends continue, it would suggest that cryptocurrency users prefer non-U.S. dollar stablecoins that have diversified their reserves to protect holders from bank failures.
Risk management for stablecoin issuers clearly includes reserve composition, but also extends to jurisdictional risk. Tether's early focus on jurisdictional diversification allowed it to navigate these market conditions more smoothly than many of its competitors.
Having said that, market conditions are constantly changing, and it is Tether's priority to closely monitor global economic and regulatory changes in order to protect USD₮ users and all decentralized protocols that rely on USD₮.
These changing preferences for stablecoins may not only increase the adoption of Tether, but lead to USD₮ gradually becoming the main stablecoin used in De-Fi.
Stablecoins and De-Fi
Tether has always believed that people everywhere should have access to financial services. However, it is currently the wealthy who can take full advantage of the various financial services and products the market offers and get more help/protection from traditional financial intermediaries in times of crisis.
De-Fi represents a compelling model for how financial services can be extended to other populations. In addition, the current model relies on multiple layers of financial intermediaries, so the act of using financial services takes up more and more user assets, which is unacceptable.
While USDC typically dominates De-Fi, we believe its concentrated exposure to US banking risk undermines its own promise of decentralization. Given these recent risks, we believe USD₮ is an ideal vehicle for the unbanked and emerging markets to use De-Fi without facing friction and volatility. There are many reasons why we think Tether will start to become the number one stablecoin, in addition to being used in De-Fi on many chains.
Integration and adoption of USD₮ across protocols and blockchains
Tether was one of the first tokens to introduce a new liquidity protocol, and that’s because Tether is often called the “lifeblood” of the crypto economy, providing huge pools of liquidity and assets that crypto users have trusted for years . Tether is the largest and most liquid stablecoin and is well ahead of its competitors. Many users prefer stablecoins as one of their primary trading pairs when using De-Fi. USD₮ users can make payments using a variety of secondary markets and De-Fi protocols, or as trading pairs with thousands of cryptocurrencies.
USD₮ is integrated in 13 widely used blockchains. Developers can access USD₮ in a variety of environments, no matter where they decide to launch their protocol. Additionally, since many De-Fi protocols are now deployed on multiple blockchains simultaneously, USD₮ provides a way for developers to ensure that assets from one chain can be swapped to a different chain more seamlessly.
USD₮ is the most widely adopted, most integrated, and most liquid stablecoin in cryptocurrency.
Decentralization, Stability and Diversity
Jurisdictional concentration is one of the existential risks of stablecoins, as the recent banking crisis has shown. If a stablecoin is to become widely used in De-Fi, it must not pose a centralization risk, otherwise it would remove many of the benefits of these different protocols.
Tether offers a portfolio of smart reserves (mainly holding treasury bills that do not face risks such as bank failure) and multiple layers of international banking partners to mitigate jurisdictional risk.
Furthermore, while some may argue that an algorithmic stablecoin can solve these challenges because it has no traditional reserves, history tells us that these stablecoins are actually riskier and more volatile. These designs have not been successfully implemented on a large scale. Fully collateralized stablecoins are the only stablecoins that retain their value over the long term.
USD₮ is currently adopted in De-Fi
There are many examples of USD₮ playing a pivotal role in the growing De-Fi space. One example of this is flash loans, which allow users to borrow various tokens without providing collateral to back these loans, as long as the collateral is automatically repaid in the same transaction.
USD₮ also provides support for various lending programs. On Aave, one of the largest and most widely used lending protocols, USD₮ often offers lenders the best yield, although this fluctuates based on market conditions.
Integration Across De-Fi and Exchanges
Tether is the most widely used trading pair on exchanges, bar none. This not only provides it with deep liquidity, but also deep usability for the various trading platforms users want to access.
This allows USD₮ to be transferred seamlessly from the De-Fi ecosystem to exchanges without additional steps such as converting USD₮ to a different asset. Most exchanges support USD₮ trading pairs for the vast majority of assets they list.
Reserve Transparency
Tether has been a leader in reserve transparency. At a time when other companies withheld information about their reserves, we were the first to issue proof of reserves. Tether's proofs continue to grow in detail and scope as we disclose more and more details about our reserves.
Tether is also constantly on the lookout for the most reputable auditor it can find. Due to accounting and regulatory uncertainties, mainstream audit firms cannot provide comprehensive audits to companies in the crypto industry, and therefore to stablecoin companies, which is why our competitors do not conduct comprehensive audits either (despite trying to ensure their safety). Nevertheless, we were able to ensure that the audit firm BDO Italia provided regular attestations regarding Tether reserves. BDO Italy has been investing in attracting people with the right technical expertise to this 'new' market, but recruiting and developing in-house capabilities for audit firms is extremely challenging in the current market, as expertise is often transferred to actively building future financial industry company. We believe that the trend is set and audit firms aiming to succeed in the future will need to invest and acquire expertise sooner or later.
In addition to its stablecoin industry-leading reserve transparency, Tether continues to earn substantial profits, which has helped it grow excess reserves to back USD₮. The latest data shows that Tether's net operating profit in the first quarter of 2023 exceeded that in the last quarter of 2022. Tether achieved a profit of $700 million in the first quarter. The outlook for the second quarter is also positive.
Help USD₮ users recover funds
Tether has been able to help mitigate hacking attacks in the De-Fi space, which could provide additional confidence to users using USD₮ to interact with De-Fi protocols.
When Poly Network was hacked, Tether responded quickly, freezing 33 million USD₮ just before it was deposited into Curve, recovering the loss of these funds.
After the KuCoin hack, Tether froze $33 million worth of stolen user funds. Following the time of the Yearn Finance hack, Tether was able to freeze $1.7 million stolen from users in time. Tether was even able to freeze $300,000 worth of USD₮ stolen from user wallets when hackers exposed private keys via evernote. In fact, Tether has currently frozen more than $720 million in various investigations out of more than 160 investigations across four continents.
What Tether's History Can Tell Us About De-Fi's Future
Like most crypto companies, Tether's early history has been full of trials and challenges, exploring what it means to function in the nascent decentralized financial system. Tether faced many challenges, but ultimately overcame them to become the stablecoin of choice for cryptocurrency traders, developers, investors, and users in emerging markets.
Addressing these early challenges taught Tether the value of redundant, governed allocations, principles that are part of the reason USD₮ is so well positioned to be a major De-Fi asset.
Tether plans to continue supporting the industry, users, emerging markets, and De-Fi protocols as we lead the industry's next evolution as a global community.
https://tether.to/en/why-tether-will-lead-in-de-fi/
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SimpleSwap to List Tether Euro (EURT) and Tether Gold (XAUT)
Tether is pleased to announce the listing of Euro Tether (EUR₮) and Tether Gold (XAU₮) ) on SimpleSwap. SimpleSwap is an instant trading platform with a user-friendly interface for an unlimited number of trades or purchases on supported exchanges.
Launched in 2018, SimpleSwap is a platform that supports instant transactions across multiple exchanges. The platform provides 500+ digital assets for customers to choose from, and customers can trade a variety of trading pairs.
SimpleSwap customers can now trade or buy two stablecoins from Tether, the issuer of USD₮: EURT and XAUT. Tether The world's first most stable and trusted stablecoin. With XAU₮ available on the platform, customers can buy or trade stablecoins that represent ownership of physical gold, long considered a hedge against inflation. Additionally, with the launch of EUR₮ on SimpleSwap, customers can obtain euro-pegged stablecoins from the stablecoin company, which has never in its history rejected a valid redemption request.
In addition to trading, SimpleSwap also offers a lightweight crypto wallet that can be used as a browser plugin. SimpleSwap's mobile app is available on iOS and Android and is available in 10 languages.
https://tether.to/en/euro-tether-eurt-and-tether-gold-xaut-to-launch-on-simpleswap/
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Tether: Bloomberg's report is irresponsible, reiterates that it has not contacted banks such as Silvergate
Tether said the Bloomberg report was irresponsible. Tether reiterated that it had no contact with Silvergate, Silicon Valley Bank and Signature Bank.
According to Tether, Bloomberg states in several paragraphs of the article: “According to Alma Angotti, who holds senior enforcement roles at the SEC and Treasury, the offshore stablecoin provider has never been sanctioned for doing business with the company. It's not illegal." After clicking on the inducing headline, even the reporter admitted that Tether and Signature Bank would have no problem cooperating, but it did not explain that Tether does not have an account at Signature Bank. Tether said Bloomberg relied on misinformation and induced clicks to remain marginally relevant.
Tether provides a sensible mix of reserves (mainly holding treasury bonds, etc. that are not affected by bank failures) and multiple layers of international banking partners to mitigate jurisdictional risk.
According to previous news, people familiar with the matter: Tether sells USDT stable currency to US customers through the Signet payment platform of Signature Bank.
https://www.odaily.news/newsflash/318860? source=share
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ChangeNOW has listed Tether Gold (XAUT) and Euro Tether (EURT)
