Tether Holds $3.2B Excess Reserves, Reduced Secured Loans by $330M, Q3 Attestation Reveals

A quarterly attestation from stablecoin issuer Tether revealed that it now holds $3.2 billion in excess reserves. In the landmark Q3 update, the USDT issuer announced that its reserves contained the highest percentage of cash and cash equivalent ever recorded.

The Q3 attestation also revealed that Tether’s secured loans dropped by $330 million to $5.2 billion from the $5.5 reported in the second quarter. According to Tether, the reduction resulted from its increased confidence that it could “manage its financial assets prudently.”

Tether’s Healthy Reserves

In its first quarterly report since former Chief Technology Officer Paolo Ardoino was promoted to CEO, the biggest stablecoin issuer revealed a notable landmark going into the last quarter of the year. The portion of Tether’s cash and cash equivalent (C&Ceq) had reached its highest since the company’s inception.

According to the report, an impressive 85.7% of its total reserves are in C&Ceqs, with a majority of them invested in US Treasury bills. Tether has about $72.6 billion of direct and indirect funds in US Treasury bills.

The Q3 reduction in secured loans conforms with the issuer’s earlier promises to bring the amount of USDT lent to borrowers to zero. Last year, Tether stated that it intends to eliminate secured loans from its balance sheet to avert the risks of borrowers failing to return funds, as seen in BlockFi and Genesis’s exposure to FTX.

Ardoino Expects $4.3B Excess Reserve in Q4.

According to the forecast in the report, Tether expects to accumulate at least $4.3 billion in excess reserves by the end of the fourth quarter. Under the projections, the stablecoin issuer looks to shrink its secured loan further to just $900 million.

As part of its resolution, Tether is looking to accumulate Bitcoin worth up to $2.1 billion by December 31, 2023. Tether remains the biggest stablecoin issuer by a huge margin, controlling up to 68% of the total stablecoin market.