S&P Global changed its reliability assessment for USDT. Analysts downgraded the asset from a constrained level 4 to a weak level 5. This represents the lowest possible score on the risk scale for fiat-pegged cryptocurrencies.
The updated reserve structure drove the review. Experts noted an increase in high-risk assets backing the token over the past year. The company ramped up investments in Bitcoin, gold, and corporate bonds. The portfolio also includes secured loans. S&P views these holdings as vulnerable to market volatility, credit risks, and interest rate shifts.
Questions on Disclosure
Analyst concerns also extended to reporting quality. Tether provides limited details on the reliability of its custodians and banking partners. The agency highlighted a persistent lack of data regarding counterparties and account providers.
El Salvador-based Tether has issued approximately $184 B in tokens. The issuer maintains it fully backs obligations with U.S. Treasury bills and other liquid instruments. The S&P report acknowledges the stablecoin has kept price stability even during crypto market turbulence.
Read also:
- Tether Expands Interest in Gold Amid Record Profits – Financial Times
- Tether Launches STBL Project With Digital Dollars and NFTs
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