The mystery of Tether’s 69 billion U.S. dollar reserves: executives who invest in China’s commercial paper face criminal investigations
According to a document obtained by Bloomberg Businessweek, it shows detailed accounts of Tether Holdings Ltd.’s recent reserves, including short-term loans of billions of dollars to some large Chinese companies.
Bloomberg Business Weekly published a cover article “Tether’s $69 Billion Mystery” ($69 billion Tether Encryption Mystery), which pointed out that Tether has experienced exponential growth this summer. There are currently 69 billion Tether in circulation, which means that Tether should hold It is backed by a corresponding US$69 billion in assets, which is enough to make Tether one of the top 50 banks in the United States. But for many years, although Tether company has guaranteed fund endorsement, the reserve behind it has always been a mystery. The following are the main five points of the article:
1. Tether has invested part of its reserves in Chinese commercial paper. According to a document obtained by Bloomberg Businessweek, it shows detailed accounts of Tether Holdings Ltd.’s recent reserves, including short-term loans of billions of dollars to some large Chinese companies-which is actually something that money market funds should avoid, and This incident happened before the problems of Evergrande Group, one of China’s largest real estate developers. However, Tether denies holding any Evergrande debt, but its lawyer refused to disclose whether Tether holds other Chinese commercial papers. The lawyer only stated that most of Tether’s commercial papers have received high ratings from credit rating companies.
2. Tether has lent billions of dollars in mortgage loans using cryptocurrency as collateral , some of which are collateralized by Bitcoin . According to Tether founder Alex Mashinsky, one of these companies is Celsius Network Ltd., a “quasi-bank” for cryptocurrency investors, said Celsius Network CEO Alex Mashinsky , The company paid Tether a 5%-6% interest rate. Tether is the main investor in Celsius Network raising $30 million in financing in June 2020. Last month, Celsius Network received a suspension order from the Kentucky Securities Regulatory Agency regarding the earning of interest on certain encrypted accounts. The regulator believes that these accounts violate The state’s securities laws fail to disclose to customers their deposits and whether they are protected by state regulation. Tether’s lawyers stated that the risk of mortgage loans is low because borrowers must provide bitcoins of higher value than they have borrowed.
3. A banker said that Tether executives actually put reserves at risk. According to John Betts, former CEO of Noble Bank International LLC in Puerto Rico, Tether, Tether’s CFO Giancarlo Devasini has put its reserves at risk. He said: “This is not a stable currency, but a high-risk offshore Hedge Fund.”
4. Tether no longer keeps all its assets in a bank in the Bahamas. Jean Chalopin, chairman of Deltec Bank & Trust in Nassau, Bahamas, stated that they only hold cash and extremely low-risk bonds for Tether. But recently he said that Tether has begun to use other banks to process its funds, and currently only about a quarter (approximately $15 billion) is still in Deltec’s hands. Jean Chalopin said: “I can’t talk about things I don’t know, I can only control the relationship between us (Tether and Deltec).”
5. Tether executives are the subject of criminal investigations in the United States. According to Bloomberg News, earlier this year, the U.S. Department of Justice prosecutors wrote to Devasini and other Tether executives, informing them that they have been the target of a criminal investigation of bank fraud and that the FBI is investigating whether they deceived many years ago. The bank opens an account.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/the-mystery-of-tethers-69-billion-u-s-dollar-reserves-executives-who-invest-in-chinas-commercial-paper-face-criminal-investigations/
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