Tether Confirms Alameda’s Fall Doesn’t Affect USDT On Solana Chain
Tether explains Alameda Research’s heavy involvement in Solana has no impact on the fundamental dynamics of how USDT works and USDT issuance as the token only represents a claim for $1 in reserves, and collateral.
On November 17, Tether, the issuer of the USDT stablecoin, issued a statement stating that although Alameda is one of the largest issuers of USDT, the failure of Alameda does not mean is that it puts this company at risk.
Since USDT is issued when institutions send USD to Tether, the company will issue USDT at a 1:1 ratio, corresponding to the amount of USD sent to company. This USD will then be converted into reliable, highly liquid and safe collateral (US Treasury, etc.).
All USDT is fully collateralized by Tether’s reserves and each USDT can be redeemed 1:1 in USD. In other words, Alameda process of issuing USDT is Tether that allows USDT to be issued after Alameda deposit USD, these reserves are still in the hands of the company and they are not on Alameda’s balance sheet.
Like other USDT holders, Alameda can use their USDT to exchange that USDT for USD through Tether’s exchange facility. Additionally, the company has not lent Alameda any USDT or other funds, and the company itself has no outstanding USDT loans, Tether reserves, or any other funds.
In the announcement the company also stated that it is not placing highly leveraged directional bets on digital assets as part of its operations.
In addition, Tether states that there is no inherent risk to USDT issued on Solana, and USDT issued on Solana is the same as USDT issued on any other chain. The token simply represents a claim for $1 in reserves and collateral.
Alameda’s substantial involvement in Solana will not affect the underlying dynamics of USDT functionality and USDT issuance. The move to halt USDT deposits on these exchanges could simply be due to the close relationship between FTX, Alameda, and Solana.
If USDT holders want to exchange Tether for USDT, they still can. USDT on Solana is equivalent to USDT on any other blockchain, it is not issued by Solana, nor is it held by Alameda or FTX.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Website: coincu.com
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Tether Confirms Alameda’s Fall Doesn’t Affect USDT On Solana Chain
Tether explains Alameda Research’s heavy involvement in Solana has no impact on the fundamental dynamics of how USDT works and USDT issuance as the token only represents a claim for $1 in reserves, and collateral.
On November 17, Tether, the issuer of the USDT stablecoin, issued a statement stating that although Alameda is one of the largest issuers of USDT, the failure of Alameda does not mean is that it puts this company at risk.
Since USDT is issued when institutions send USD to Tether, the company will issue USDT at a 1:1 ratio, corresponding to the amount of USD sent to company. This USD will then be converted into reliable, highly liquid and safe collateral (US Treasury, etc.).
All USDT is fully collateralized by Tether’s reserves and each USDT can be redeemed 1:1 in USD. In other words, Alameda process of issuing USDT is Tether that allows USDT to be issued after Alameda deposit USD, these reserves are still in the hands of the company and they are not on Alameda’s balance sheet.
Like other USDT holders, Alameda can use their USDT to exchange that USDT for USD through Tether’s exchange facility. Additionally, the company has not lent Alameda any USDT or other funds, and the company itself has no outstanding USDT loans, Tether reserves, or any other funds.
In the announcement the company also stated that it is not placing highly leveraged directional bets on digital assets as part of its operations.
In addition, Tether states that there is no inherent risk to USDT issued on Solana, and USDT issued on Solana is the same as USDT issued on any other chain. The token simply represents a claim for $1 in reserves and collateral.
Alameda’s substantial involvement in Solana will not affect the underlying dynamics of USDT functionality and USDT issuance. The move to halt USDT deposits on these exchanges could simply be due to the close relationship between FTX, Alameda, and Solana.
If USDT holders want to exchange Tether for USDT, they still can. USDT on Solana is equivalent to USDT on any other blockchain, it is not issued by Solana, nor is it held by Alameda or FTX.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
Join us to keep track of news: https://linktr.ee/coincu
Website: coincu.com
Foxy
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