Customize Consent Preferences

We use cookies to help you navigate efficiently and perform certain functions. You will find detailed information about all cookies under each consent category below.

The cookies that are categorized as "Necessary" are stored on your browser as they are essential for enabling the basic functionalities of the site. ... 

Always Active

Necessary cookies are required to enable the basic features of this site, such as providing secure log-in or adjusting your consent preferences. These cookies do not store any personally identifiable data.

No cookies to display.

Functional cookies help perform certain functionalities like sharing the content of the website on social media platforms, collecting feedback, and other third-party features.

No cookies to display.

Analytical cookies are used to understand how visitors interact with the website. These cookies help provide information on metrics such as the number of visitors, bounce rate, traffic source, etc.

No cookies to display.

Performance cookies are used to understand and analyze the key performance indexes of the website which helps in delivering a better user experience for the visitors.

No cookies to display.

Advertisement cookies are used to provide visitors with customized advertisements based on the pages you visited previously and to analyze the effectiveness of the ad campaigns.

No cookies to display.

Connect with us

Hi, what are you looking for?

Technology

Tether Faces Challenges in Maintaining Dollar Peg, According to S&P Global

Key Takeaways

S&P Global Ratings recently conducted an assessment on Tether and other stablecoins, revealing some key findings:

  • Tether’s ability to maintain its peg is considered “constrained” due to concerns about reserve transparency, regulatory framework, and risk appetite.
  • USD Coin has been assessed as “Strong” by S&P Global Ratings, positioning it favorably among stablecoins.

Tether’s Current Situation

Tether (USDT), the largest stablecoin by market capitalization, faces challenges in maintaining its peg to the U.S. dollar. S&P Global Ratings has highlighted several areas of concern, including:

  • Lack of transparency regarding entities managing USDT’s reserves.
  • Presence of significant exposure to riskier assets in Tether’s reserves.
  • A rating of 4 out of 5 by S&P Global Ratings, indicating a “constrained” situation for Tether.

Concerns Raised by S&P Global Ratings

S&P’s assessment of Tether points out specific issues that raise red flags:

  1. Reserves primarily held in low-risk assets without transparent information on custodians or counterparties.
  2. Double-digit exposure to riskier assets like corporate bonds, precious metals, and bitcoin.
  3. Lack of regulatory framework, primary redeemability, and asset segregation.

Previous Scrutiny on Tether’s Reserves

Tether’s reserves have faced scrutiny in the past, including enforcement actions by regulatory authorities in 2021 for inadequate information disclosure.

Assessment of Other Stablecoins

S&P Global Ratings also evaluated other stablecoins:

  • USD Coin (USDC), Pax Dollar (USDP), and Gemini Dollar (GUSD) received favorable scores indicating strength.
  • FRAX (FRAX) and TrueUSD were rated as the weakest stablecoins with a score of 5 or “Weak.”
  • DAI (DAI) and First Digital USD (FDUSD) obtained similar ratings to Tether in the assessment.
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Información básica sobre protección de datos Ver más

  • Responsable: Masha Media News.
  • Finalidad:  Moderar los comentarios.
  • Legitimación:  Por consentimiento del interesado.
  • Destinatarios y encargados de tratamiento:  No se ceden o comunican datos a terceros para prestar este servicio. El Titular ha contratado los servicios de alojamiento web a Banahosting que actúa como encargado de tratamiento.
  • Derechos: Acceder, rectificar y suprimir los datos.
  • Información Adicional: Puede consultar la información detallada en la Política de Privacidad.

Trending

You May Also Like

Bitcoin

Bitcoin Market Cap Surpasses $1 Trillion Bitcoin recently achieved a significant milestone by surpassing a $1 trillion market capitalization for the first time since...

News

The Latest in Cryptocurrency News Stay updated with the most recent developments in the world of cryptocurrency with Cryptowire. From market trends to new...

News

The Impact of AI on Crypto Trading Artificial intelligence (AI) is poised to revolutionize the world of crypto trading. Brett Harrison, former President of...

Bitcoin

Bitcoin Miner Stocks Outpacing Bitcoin Prices Bitcoin miner stocks are exceeding the price of Bitcoin, reaching their highest levels since 2021 as the cryptocurrency...

News

The Evolution of Ethereum The Ethereum network has evolved significantly, transitioning from Proof-of-Work to Proof-of-Stake through “The Merge.” This shift has established a native...

News

The Rise of Ethereum Network Transaction Revenue The Ethereum network is currently generating over $1 million daily in transaction revenue, marking a significant 35%...

News

American-Israeli Crypto Lender Celsius Faces Financial Crisis American-Israeli crypto lender Celsius recently laid off approximately 150 employees as it grapples with a financial crisis...

Technology

IOTA Introduces Layer 2 Ethereum Virtual Machine (EVM) Network IOTA has recently launched its layer 2 Ethereum Virtual Machine (EVM) network, with a strong...

Copyright © 2024 COINNEWSBYTE.COM. All rights reserved. This website provides educational content, emphasizing that investing involves risks. Ensure you conduct thorough research before investing and be ready for any potential losses. For those over 18 and interested in gambling: Online gambling laws differ across countries; adhere to your local regulations. By using this site, you agree to our terms, including the presence of affiliate links that do not impact our evaluations. Cryptocurrency offers on this site are not in line with UK financial promotion regulations and are not aimed at UK consumers.