FUD deFudded

Tether CEO Paolo Ardoino has disclosed that the company holds more than 82,000 Bitcoin and 48 tonnes of gold in its reserves. Ardoino disclosed this on X while clarifying comments about Tether USDT reserves.

This was in response to his earlier statement at the Lugano Plan B Event when discussing Tether products. According to him, the company also has over $100 billion in US Treasuries backing the USDT stablecoin. Thus, all its USDT is fully backed.

He said:

“Since I see a lot of confusion in this thread, let me clarify that: – Tether has ~100B in US treasuries. Plus it has 82k+ BTC and 48T+ of gold.”

Ardoino comments have attracted positive comments from the crypto community, with some noting the diversification of Tether reserves. Some observed that Tether having gold to back USDT is very good, which means USDT is gold-backed. In their opinion, this makes it even better than the actual US dollar, which stopped the gold backing in the 1970s.

Meanwhile, other users are more curious about the full state of Tether reserves, particularly how it custodies the gold and whether they are audited. One user on X questioned whether the gold in Tether reserves is actual gold bullion or derivatives such as exchange-traded funds (ETFs) and options.

Crypto markets recovering from FUD about Tether

The public disclosure of how Tether backs its USDT stablecoin appears connected to the recent claims by the Wall Street Journal that the company is under investigation by the US Department of Justice. Although Tether immediately moved to dismiss the news, which it termed as mere speculation and “regurgitating old noise,” it was enough to cause a reaction in the market.

Ardoino has since tried to quell the fears, uncertainty, and doubts  (FUD), noting that Tether collaborates with law enforcement globally, including in the US, to tackle crimes. Therefore, the company would have information about an investigation against it.

He said:

“We would know if we are being investigated as the article falsely claimed. Based on that, we can confirm that the allegations in the article are unequivocally false.”

This is not the first time the stability of USDT has been questioned, and each time, it has raised broader concerns in the market. USDT occupies an important position in the crypto market, with a market cap of $120 billion, and it is used for most crypto transactions. Per data from CoinMarketCap, USDT had a trading volume of $32 billion in the last 24 hours, more than any other crypto asset, highlighting its importance within the crypto ecosystem.

This importance means any news questioning USDT stability always has a negative impact on the market. However,  the market appears to have recovered from the FUD that followed the news. Bitcoin value has increased slightly, and total open interest in crypto products has increased by more than 1%, according to CoinGlass. Still, futures volume is down 43% in the past 24 hours.

Tether teases Local AI Development Kit

Meanwhile, Tether continues its gradual diversification efforts to expand its business beyond stablecoin issuance. The company recently previewed its Local AI development kit for writing and deploying artificial intelligence systems on various devices.

Ardoino, who unveiled the product, claims it is privacy-focused and uses peer-to-peer technology to enable developers to write codes on all devices, from mobile phones to high-end computing systems powered by H100 chips. According to Ardoino, the SDK supports multiple AI models, including Llama and Marian, enabling its use for several purposes.

Ardoino said:

“Tether’s AI SDK is extremely modular, it uses supports any model (Marian, Llama, …) and loads/stores weights and fine-tuning data in P2P data structures.”

The Tether AI SDK has not been launched, but as Ardoino noted, it will be made open-source once the company has fully tested and ascertained that it is ready for public launch.