TechFlow news — Tether, the issuer of the stablecoin USDT, stated that although Alameda was one of the larger issuers of USDT, its collapse does not pose any risk to Tether. USDT is issued when institutions send U.S. dollars to Tether, who then issues USDT on a 1:1 basis corresponding to the amount of dollars received. Tether subsequently converts these dollars into reliable, liquid, and conservative collateral (such as U.S. Treasury securities). All USDT is fully backed by Tether's reserves, and every USDT can be redeemed 1:1 for U.S. dollars. In other words, the process of Alameda issuing USDT involved Alameda first sending dollars to Tether, after which Tether authorized the issuance of USDT—the reserves remain in Tether’s possession and are not reflected on Alameda’s balance sheet. Like all other USDT holders, Alameda could use Tether’s redemption tools to exchange their USDT for U.S. dollars. Furthermore, Tether did not lend any USDT or other funds to Alameda—Tether has no outstanding USDT loans, nor has it exposed its reserves or any other funds. Tether also does not engage in highly leveraged directional bets on digital assets as part of its operations.
Additionally, Tether emphasized that USDT issued on Solana carries no inherent risk. USDT issued on Solana is identical to USDT issued on any other blockchain. The token simply represents a claim to one dollar held in Tether’s reserves and collateral. Alameda’s significant involvement with Solana does not affect the fundamental mechanics of how USDT functions or how USDT issuance operates. Measures by certain exchanges to suspend USDT deposits may stem solely from the close associations among FTX, Alameda, and Solana. However, if USDT holders wish to redeem their tokens through Tether, they still can. USDT on Solana is equivalent to USDT on any other blockchain—it is not issued by Solana, nor is it held or controlled by Alameda or FTX.Original link
