Tether eying US Treasuries as a major buyer
According to the CEO of USAT, which is launching a new stablecoin USAT, Tether could become one of the largest holders of US Treasuries in 2023. This projection is based on the growing demand for Tether's flagship USDT stablecoin, as well as the recent launch of USAT.
Tether is currently the largest stablecoin issuer, with its reserves exceeding $80 billion. The company has already started actively investing some of these funds into US government securities, building up its portfolio of short-term Treasury bills.
According to the forecast, this year Tether could become one of the top 10 buyers of US Treasuries. This is due to several factors:
- The growing demand for the USDT stablecoin, which is increasingly used in various cryptocurrency operations
- The launch of the new USAT stablecoin, which will also be backed by reserves invested in government bonds
- The need for Tether to diversify its reserves and increase the share of conservative assets such as Treasury securities
Tether's investments in US government debt could have an impact on both the cryptocurrency market and the traditional financial market. On the one hand, this will allow Tether to strengthen trust in its stablecoins. On the other hand, large inflows of funds from Tether could affect the dynamics of Treasury yields.
Expert opinion: Tether's actions to increase investments in US government debt seem quite logical. The desire for greater diversification of reserves and an increase in the share of conservative assets indicates that the company is striving to enhance the stability of its stablecoins. This, in turn, may strengthen the trust of cryptocurrency market participants in USDT and USAT. At the same time, such significant inflows of Tether's funds into US Treasuries could have a certain impact on the yield of US government debt.