Tether has denied allegations made in a Bloomberg article that it had exposure to the now-collapsed Signature Bank. The stablecoin issuer responded by stating that it has “no exposure to Silvergate, Silicon Valley Bank and Signature Bank” and that there was no account set up between Tether and Signature Bank. The allegations claimed that Tether was gaining access to the US banking system through Signature by encouraging users to send US dollars via Signature’s Signet to its Bahamian partner Capital Union Bank.
Despite Tether CTO Paolo Ardoino’s earlier tweets clarifying that the company had zero exposure to Signature Bank, the allegations still persisted. Ardoino had also tweeted that Tether had no exposure to Silvergate and Silicon Valley Bank on March 2 and 10, respectively.
Ardoino recently confirmed that Tether has around $1.7 billion in excess reserves at the Paris Blockchain Week 2023 event. He further stated that USDT is one of the “safest assets to hold in the world” following the banking crisis.
This comes after Tether was accused by the Wall Street Journal of faking documents to open bank accounts. The report alleged that Tether had faked sales invoices, transactions and hid behind third parties to have opportunities to open bank accounts it couldn’t have otherwise.
Tether’s recent response to the allegations made by Bloomberg is significant as it strengthens the stablecoin issuer’s position in the market. The allegations had caused a great deal of concern among investors, who were worried about the safety of their investments.
The stablecoin issuer’s claims that it has no exposure to Signature Bank, Silvergate and Silicon Valley Bank will help to restore investor confidence. Tether’s excess reserves of $1.7 billion and the fact that USDT is one of the safest assets to hold in the world are also likely to reassure investors.
However, the allegations made by the Wall Street Journal regarding Tether’s fake documents are still a cause for concern. If true, they could have serious implications for the stablecoin issuer’s reputation and could result in regulatory action.