Q&A with Paolo Ardoino, Tether CTO | Invezz

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Tether has launched Tether tokens on Avalanche, a decentralised smart contracts platform developed to support global finance and business. Avalanche is a highly scalable ecosystem with low transaction fees, which delivers near-instant transaction finality. 

Tether’s launch on Avalanche will drive stablecoin usage across the DeFi ecosystem and support the long-term growth and sustainability of the Avalanche network at the same time.


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Invezz talked to Paolo Ardoino, CTO at Tether, about the launch and other interesting developments.

1.           What are the advantages of Avalanche over other decentralised smart contracts platforms?

We have continued to see Avalanche grow at a rapid pace, hitting new all-time highs in user activity, including transaction volume, unique addresses (now over 670,000), and assets transferred from Ethereum to Avalanche over the Avalanche Bridge ($5.9B).

2.          What’s behind the decision to add Tether to Avalanche? 

USDt is the most liquid and widely adopted stablecoin. A wrapped version of USDt is already available on Avalanche and is already the most used stablecoin on the Avalanche C-Chain. Providing an official USDt token will increase its liquidity and availability even further.

3.          There has been controversy around Tether, most notably opinions about a purported lack of backing. What is your take on this? 

Tether holds a strong, conservative, and liquid portfolio with an emphasis on safeguarding our reserves. This includes our commercial paper holdings, whose maturities we have published as part of our quarterly assurance attestations. In fact, as we are sure you’re aware from your research, we publish the maturities of our commercial paper holdings as part of the attestations.

As we have indicated in our published statements and in our most recent assurance attestation with a reporting date of June 30, 2021, the vast majority of the commercial paper held by Tether is in A-2 and above rated issuers.  Additionally, from these statements, you can see that all of our commercial paper matures in one year or less, and fully one-third of the entire commercial paper portfolio matures within 90 days.

These ratings refer to S&P short-term credit ratings, where available. Where a rating is unavailable, publicly available industry-standard conversion tables have been used to convert ratings from Moody’s or Fitch to the S&P equivalent.

Moreover, we maintain cash that is many multiples of our largest single historical redemption and our largest 24 hour period of redemptions. Most importantly, Tether has never refused a redemption to a customer—not once.

4.         What is your prediction for the future of stablecoins? Do you believe the market will keep growing, perhaps more dynamically than that of ‘traditional’ cryptocurrencies? Why or why not? 

Tether believes that open and interoperable protocols will certainly be the key to unlocking global payment methods in the future. Stablecoins have and will continue to be the underlying asset that encourages this growth of the ecosystem.

5.          What are your predictions relating to CBDCs? 

We think it’s great that governments are taking inspiration from private stablecoins, and especially Tether, as the most liquid, trusted, and popular stablecoin.

We believe there’s room in the space for both Tether and CBDCs: private stablecoins for trust and innovation and CBDCs for bank wires and certain other remittance.

 

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