Tether, the biggest stablecoin issuer in the world, has made sure that USDT on the Solana network poses no hazards.
On November 18, Tether released a statement claiming that USDT issued by Alameda was immune to any spillover effects from the defunct FTX exchange.
Solana is the third-largest stablecoin network, behind Tron and Ethereum, according to the Tether transparency report. 1.89 billion USDT, or just under 3% of the supply, are available on Solana.
Why USD₮ Issuances Ensures No Risks from FTX/Alameda https://t.co/iLXchRHVsI
— Tether (@Tether_to) November 18, 2022
The fintech company noted that when institutional parties pay dollars to Tether, USDT is created on a 1:1 ratio. According to the statement, Alameda for Tether on Solana was a case in point:
“Those reserves are still in Tether’s possession; they are not on Alameda’s balance sheet. The collateral backing Alameda’s USDT is not on Alameda’s balance sheet.”
Alameda’s sole choice is to redeem the USDT and request that Tether restore the dollars.
Tether claims that it does not owe Alameda any unpaid stablecoin debts or other financial obligations.
Meanwhile, Solana’s native token has fallen another 5.7% today, down to $13.68 as of this writing. According to CoinGecko, SOL has now lost 56% over the last two weeks and is 95% below its all-time high.