Will USDT crash?
Last night, Tether released its third-quarter financial report, which was quite explosive. This is one of the reasons why many friends in core groups asked me if USDT will crash, and I firmly believe it won't. In the third quarter, Tether's profit exceeded 2.5 billion USD, and as of September 30, 2024, Tether's total assets amounted to 134.424 billion USD, total liabilities were 120.272 billion USD, and net assets were 14.152 billion USD. Among these, the total value of reserve assets is 125.472 billion USD, which exceeds its corresponding total liabilities of 119.38 billion USD, resulting in excess reserves of 6.092 billion USD.
In the third quarter, the number of U.S. Treasury bonds held directly and indirectly by Tether has increased, totaling over 102 billion USD. In simpler terms, a large portion of USDT's backing is in U.S. Treasury bonds, and Tether's main profits come from the yields on these bonds.
To put it another way, as long as Tether doesn't act recklessly, it won't fail. The only thing that could cause Tether to crash is a collapse of U.S. Treasury bonds. If U.S. Treasury bonds were to crash, then the dollar and the whole world would collapse, and no one would care about Tether anymore, haha! Worrying about Tether crashing is like worrying that quantum computing will destroy BTC and the financial system; while it is possible, it likely won't be witnessed in our lifetime...
Additionally, as of the third quarter, Tether held 75,353.56 BTC, which did not increase compared to the second quarter but rather decreased by 187.71 BTC. PS: I wonder how many friends remember that Tether said in the first quarter of 2023 that it would use 15% of its quarterly profits to purchase Bitcoin, but by the third quarter of 2024, not only did it not increase its BTC holdings, but it also decreased, which is a breach of trust.
