Tether distances itself from Celsius

Stablecoin provider Tether has lashed out at “rumors” about its holdings of commercial paper.

Commercial paper is a form of short-term corporate debt.

Tether also distanced itself from troubled lender Celsius and crypto hedge fund Three Arrows Capital.

The tether stablcoin, often known by its ticker USDT, is the biggest in the crypto market.

Tether maintains the value of its centralized stablecoin against the US dollar by using a basket of assets, including corporate debt, US Treasury bills and some cash reserves.

In a blog post on Wednesday, Tether wrote that rumors had been circulating that its commercial paper portfolio is “85% backed by Chinese or Asian commercial papers and being traded at a 30% discount.”

It called these allegations “completely false,” adding that they are likely to induce “further panic” to generate profits.

In May, Tether reported that it had reduced its commercial paper to $19.9 billion from $24.2 billion the previous quarter, a 17% decrease. It also added US Treasury bills, increasing them to $39.2 billion from $34.5 billion.

Tether added that its Celsius position has been liquidated with no losses, and that its position in regard to the crypto lender has always been over-collatoralized.