Assurance comes from Tether's custodian, Cantor Fitzgerald
In a groundbreaking revelation, Howard Lutnick, the CEO of Cantor Fitzgerald LP, has publicly vouched for Tether Holdings Ltd.'s financial solidity. As the appointed custodian for Tether, Lutnick confirmed through an evaluation of the stablecoin issuer's financial statements that their declared assets are genuine.
During the end of June, Tether's reported assets amounted to roughly $86 billion, providing substantial backing for about $83 billion of its USDT stablecoin, as highlighted by Lutnick. He emphasized that a significant portion of these assets are under Cantor Fitzgerald’s management. Tether, a pivotal player in the cryptocurrency realm, has long been under scrutiny regarding the authenticity of its claims that its coin is equivalently backed by dollars.
Lutnick, in an interview with Bloomberg Television’s Lisa Abramowicz, Jonathan Ferro, and Annmarie Hordern at the World Economic Forum in Davos, firmly stated, “They have the money they say they have. I’ve seen a whole lot and the firm has seen a whole lot and they have the money. And so there has always been a lot of talk ‘Do they have it or not?’ and I’m here with you guys and I’m telling you we’ve seen it and they have it.”
March of the previous year marked the official announcement of Tether's collaboration with Cantor Fitzgerald
As the predominant stablecoin in the crypto world, Tether’s USDT boasts a circulation close to $95 billion, as per CoinGecko data. Its significant role in the global crypto ecosystem has made it a target for both criticism and regulatory attention.
Tether CEO Paolo Ardoino, in a written response to Bloomberg, expressed gratification over Lutnick's confirmation of Tether's financial strength, “While naysayers have had their go at Tether over the years, it’s heartening to hear Cantor Fitzgerald CEO Howard Lutnick affirming the robustness of our reserves.”
Tether faced a legal hurdle in 2021, agreeing to a $40 million settlement over allegations by a U.S. regulatory body of misrepresenting its collateral. Since then, the company has been transparent about its reserves, publishing third-party attestations, though these represent momentary snapshots rather than comprehensive audits.
A recent report by the United Nations Office on Drugs and Crime pointed to USDT's use in illicit transactions and money laundering. In a rebuttal, Tether emphasized its commitment to thwarting the misuse of cryptocurrencies, arguing that the transparency and traceability of blockchain transactions render digital tokens an inefficient choice for illegal purposes.
Lutnick, who also serves as the chairman and CEO of BGC Group Inc., discussed how his brokerage firm has benefitted from the upswing in trading volumes across Wall Street. “For the banks, trading markets are back,” he asserted. “You’re going to see the banks do really, really well through this and they’re going to be a wonderful performing asset in 2024.”
He further revealed that BGC is close to launching its FMX platform for futures trading, pending approval from U.S. regulators. This platform, expected to debut later in the year, already has partnerships lined up with nearly every major U.S. bank, according to Lutnick.
Addressing the speculation about impending interest rate cuts in the U.S., Lutnick expressed skepticism. Despite market predictions of multiple rate cuts by the Federal Reserve, he emphasized that inflation is far from a resolved issue. He bluntly dismissed these predictions: “No way at all, that is just a nonsense. You go to the supermarket, you do all the things we all do, you gotta be kidding me. Inflation is not in the rearview mirror, and, therefore, we are going to stay higher for longer.”
Originally reported by Bloomberg.