{"id":16612,"date":"2023-06-01T05:52:59","date_gmt":"2023-06-01T09:52:59","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/crypto\/tether-stablecoin-recoups-lost-market-value-in-2022-crash-topping-83-2-billion\/"},"modified":"2023-06-01T05:53:01","modified_gmt":"2023-06-01T09:53:01","slug":"tether-stablecoin-recoups-lost-market-value-in-2022-crash-topping-83-2-billion","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=16612","title":{"rendered":"Tether Stablecoin Recoups Lost Market Value in 2022 Crash, Topping $83.2 Billion"},"content":{"rendered":"
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Tether, the largest stablecoin in the market, has seen its market capitalization hit a new record high, exceeding $83.2 billion.\u00a0<\/p>\n

The stablecoin, which is pegged at one-to-one with the U.S. dollar and is backed by reserves of cash and cash-equivalent assets, has recovered the $20 billion in market value it lost following the collapse of rival stablecoin TerraUSD last year.<\/p>\n

\u201cToday\u2019s numbers demonstrate that people want access to financial freedom, and when given that access, they will make use of it,\u201d Paolo Ardoino, CTO of Tether,\u00a0said in a statement.<\/p>\n

“Between our battle-tested resilience in the face of market volatility and our industry-leading transparency practices, Tether has proven that it can be trusted, and customers are responding in kind.”<\/p>\n

The instability that rocked the crypto market last year saw Tether, as well as other major stablecoins, lose a large share of their market cap as investors started exiting the market amid increased uncertainty.\u00a0<\/p>\n

While Tether has managed to recover the market value it lost last year, other stablecoins have not been this successful.\u00a0<\/p>\n

For instance, USD Coin (USDC), the second-largest stablecoin, currently has a market cap of around $29 billion, far less than its all-time high record of over $56 billion, according to data by CoinGecko.\u00a0<\/p>\n

According to researchers at Kaiko, Tether is used in more than 50% of all trades on centralized exchanges.\u00a0<\/p>\n

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Historically, there have been a lot of controversies surrounding Tether, with many questioning claims that it has enough reserves to justify its one-to-one peg claim, as well as the quality of assets making up those reserves.<\/p>\n

In 2021, the New York Attorney General\u00a0settled with Tether\u00a0over allegations of commingling client and corporate funds and lying about its reserves to investors.\u00a0<\/p>\n

Tether and its sister crypto exchange Bitfinex never admitted any wrongdoing.<\/p>\n

Tether Pushes into Bitcoin Mining\u00a0<\/h2>\n

Tether has recently\u00a0announced\u00a0that it is setting up a Bitcoin mining operation in Uruguay using renewable energy in a bid to diversify its revenue mix and “support and promote sustainable Bitcoin mining.”<\/p>\n

Notably, Tether isn\u2019t just mining Bitcoin, it is going to start buying it in bulk every month.<\/p>\n

Last month, the company announced that it would shift its treasury management strategy to start investing a portion of its net profit in Bitcoin.<\/p>\n

The company\u00a0committed to using up to 15%\u00a0of its net profit to purchase Bitcoin, following the footsteps of giant electric carmaker Tesla and technology company MicroStrategy.<\/p>\n

Meanwhile, Tether has also reported a Q1 net profit of $1.48 billion.<\/p>\n

The company has “approximately 85% of its investments in cash, cash equivalents, and other short-term deposits, along with a 20% increase in token supply quarter over quarter and ~2.5B in excess reserves (on top of the 100% minimum reserves),” it said in the recent announcement.\u00a0<\/p>\n<\/p><\/div>\n