The struggling real estate giant has listed $300 billion in total liabilities and says it needs to find funds quickly. Its been going on for a long time one analyst who warned about Evergrandes practices as early as 2012 was temporarily banned from Hong Kong markets by regulators for his reckless claims. Reuters, the news and media division of Thomson Reuters, is the worlds largest multimedia news provider, reaching billions of people worldwide every day. It goes something like this: About half of all bitcoin trades against stablecoin tether (USDT), according to data from CryptoCompare. The "Mad Money" host said the struggles of Chinese developer Evergrande are likely to keep weighing on crypto markets. It is also alleged that Tether also owns commercial paper issued by Evergrande, China's second-largest real estate developer, which is itself experiencing a major liquidity crisis. After a couple of decades of relative freedom for entrepreneurs (including, as mentioned, the apparent freedom to commit securities fraud), Chinese leadership under Xi Jinping has begun to aggressively intervene in markets. You can subscribe to get the full newsletter here. The company is currently under investigation by multiple law enforcement agencies, including the U.S. Department of Justice and the Federal Bureau of Investigation. The downgrade notice was sent to Evergrande on Sept. 15 from China Chengxin International. Evergrande has now had to suspend trading of that units onshore corporate bonds following a downgrade, another red flag pointing towards an impending default. Join the most important conversation in crypto and Web3 taking place in Austin, Texas, April 26-28. Tether is completely unbacked USD that gives these exchanges the liquidity they need to market make derivatives that have non-linear . (Reporting by Alun John; Editing by Mark Potter), Ukraine Latest: Russia Continues Efforts to Encircle Bakhmut, INSIGHT-Before fatal collapse, Turkish building had skirted code thanks to Erdogan policy, In Chicago, adapting electric buses to winters challenges, Ukraine ally Kallas fights for reelection in Estonia vote, Global race to boost electric vehicle range in cold weather. BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back. Questions for Cramer? The industry leader for online information for tax, accounting and finance professionals. News and analysis for the professional investor. Earlier this year, Tether and Bitfinex settled one of those battles over its reserves with the New York state Attorney General. Global Business and Financial News, Stock Quotes, and Market Data and Analysis. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities. The stablecoin issuer Tether this week declared that it doesnt hold short-term debt issued by troubled Chinese real estate developer Evergrande. In fact, $30 billion of the Tethers dollar holdings are invested in commercial paper, which makes one of the largest holders of this debt asset class and puts the firm ahead of some top financial firms. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. We do not give personalized investment advice or other financial advice. This stability means they offer an accessible - if boring - entry and exit point to the crypto world. Join our Telegram Group and get trading signals, a free trading course and daily communication with crypto fans! According to a spokesperson from Tether, Tether does not hold any commercial paper or other debt or securities issued by Evergrande and has never done so. In February, the operator and the related trading platform Bitfinex pledged to offer more transparency on its reserves under the terms of an $18.5m settlement with the New York attorney-generals office, leading to the most recent disclosures last month. Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Consider this - most of the reserve assets Tether holds to support its USDT are commercial papers (CPs) and certificate of deposits (CDs) instead of the US dollar. Now, the second-largest stablecoin, circle (USDC), is heading in a different direction, choosing to only use cash reserves and cash equivalents. Regardless of what commercial paper you hold, bonds and commercial paper would take a hit and some issuers may even fold," tweeted Adam Cochran, partner at Cinneamhain Ventures. Before falling into a major crisis, Chinese property developers had issued commercial paper worth 3.6 trillion yuan ($556 billion) in 202020% higher from 2019. HONG KONG (Reuters) - Tether, the world's largest 'stablecoin', said in a statement it does not hold any commercial paper or securities issued by embattled developer China Evergrande Group, as regulatory scrutiny into risks from this type of token grow. Well send you a myFT Daily Digest email rounding up the latest Cryptocurrencies news every morning. Your weekly wrap of Web3 news and trends. Crypto markets took a dip Thursday just around the time it was reported that Chinas Evergrande Group was on the verge of defaulting on a bond payment. How the biggest companies plan mass lay-offs, The benefits of revealing neurodiversity in the workplace, Tim Peake: I do not see us having a problem getting to Mars, Michelle Yeoh: Finally we are being seen, Our ski trip made me question my life choices, Apocalypse then: lessons from history in tackling climate shocks, Stablecoins: bitcoin for squares has its own downsides. Additionally, it is China's largest issuer of commercial paper with more than $300 billion in debt, according to reports. He holds Bitcoin, Ethereum, and small amounts of other crypto assets. All quotes delayed a minimum of 15 minutes. Tether: hat 50 % der USDT-Reserven in Commercial Paper-Bestnden According to Bloomberg BW, stablecoin issuer Tether has extended billions of dollars in loans to Chinese companies. First Mover The latest moves in crypto markets, in context. When Tether launched in 2014, it said every tether coin was fully backed by US dollars in bank accounts. While Tether (the company) said back in September it doesnt hold Evergrande commercial paper, about a month ago Bloomberg BusinessWeek reported Tethers holdings included billions of dollars of short-term loans to large Chinese companies something money-market funds avoid.. Explainer: How China Evergrande's debt troubles pose a - Reuters Tether has revealed that its commercial paper holdings would be $3.5 billion by July 31. The developer on Thursday applied to suspend trading of that unit's onshore corporate bonds following a downgrade, which market participants said indicated an increasing likelihood of defaults and restructuring. Evergrande, for its part, is the largest commercial paper issuer in China's real estate market, owning some $32 billion worth of commercial paper at the end of last year. Stablecoin Tether says holds no Evergrande commercial paper - Yahoo! Its flagship unit, Evergrande Real Estate Group, had 205.7 billion yuan ($32 billion) worth of commercial paper at the end of 2020,. read more. "Tether does not hold any commercial paper or other debt or securities issued by Evergrande and has never done so," the company said. Bitcoin, meanwhile, remained above all-time highs by about 5.5%. Stablecoins are rarely on the tips of investors' tongues when it comes to talking about the volatility-filled headline-grabbing crypto market. Approximately half of Tethers $62.8 billion assets as of the end of June 2021, were backed by commercial paper and certificates of deposit, according to the company. Evergrande is the biggest issuer of commercial papers. In a blog post a few days after its reserves report was released, Hoegner said the commercial paper that the company held was purchased through recognised issuance programmes, the vast majority highly rated, and that there were limits on individual issuers and regional exposures. But Stuart Hoegner, Tethers general counsel, said: With respect to reputation, we believe we are seeing the opposite: more and more counterparties are comfortable with Tether and our transparency initiatives and are keen to work with us.. Tether, the largest stablecoin, is a Hong-Kong based stable currency. This is not the first time concerns about the true value of USDT have emerged. Siddharth Venkataramakrishnan and Joe Rennison. As part of that settlement, Tether received a $18.5 million fine, agreed to no longer operate in New York and pledged to provide quarterly reports on its reserves for the next two years. "The only interest of Tether is maintaining a liquid and extremely safe portfolio," he said. The Node The biggest crypto news and ideas of the day. Markets cant function without transparent information flows, full stop. "The vast majority of the commercial paper held by Tether is . Ardoino wouldn't comment on whether the Treasury directly spoke to Tether for the report. All evidence points to tether's CP as a formal accounting trick to say "we just give a bunch of Tether to FTX, Binance, and Cumberland as stand in for USD to provide liquidity". You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. Tether's USDT remains the dominant stablecoin in the market despite the FUD surrounding the coin. Tether says it doesn't hold any commercial paper issued by Evergrande The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Chinas loose and reactive (at best) financial regulatory environment is one reason anxiety around Tether has largely centered on whether it holds Chinese commercial paper in general not just whether it holds Evergrandes. Investors aren't only looking at audits, there's also regulation. Work - Tether For critics of Tether, the new economy of digital assets is based on the worlds oldest profession: real estate speculation. Tether Denies Holding Commercial Paper Issued by Troubled Real Estate Tethers defenders can say that even if one were to assume Tether spent half of every dollar it is said to have taken in over the past two years on commercial paper in China, that would be under one-fifth of new issuances and 4% of the market. We use Stablecoin Tether says it does not hold any commercial paper from Evergrande in recent a statement. Tether still expects to be the first to secure an external financial statement audit, which it has been exploring since 2017, but it won't necessarily be from one of the Big Four accountants.
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