The CEO of Celsius Network, one of Tether’s major clients, has announced that USDT can be borrowed from the company in exchange for cryptocurrency collateral.
Celsius Network CEO Alex Mashinsky told the Financial Times in an interview that Tether received cryptocurrencies from its customers. Print USDT and debit it He said he gave
“If you give them enough collateral with assets like bitcoin, ether, they print tether in return.”
For these debts “new USDT is minted” Mashinsky said that Tether destroyed these USDTs after the debt was settled, and therefore “the amount of USDT in circulation has not increased” explained.
What Tether claims to do is inconsistent with the third clause of the company’s terms of service. In this article, Tether’s “in exchange for digital tokens like bitcoin” not just normal in exchange for money It is stated that it will print tokens.
Celsius Network’s cryptocurrency customers can use the company’s services to earn interest. In the past few months, the company has partnered with other companies offering similar services, such as BlockFi, in the US. securities regulators got on his radar.
In another interview with Bloomberg earlier this month, Mashinsky said the company, as a whole, has been separated from Tether. 1 billion USDT borrowed had said.
According to the report of the Financial Times, while the Tether management did not detail the debts in question, “We have a small group of selected clients who borrow in USDT against collateral. […] We made this statement a long time ago when we announced our reserves, and it’s no secret.” made a statement.
CEO of Celsius Network, “If the bitcoin price drops, they call us for collateral and we increase the amount of bitcoin we give them.” said.
According to Tether’s most recent report, the company $2.5 billion secured loans, which make up approximately 4% of the company’s reserves in total.
New York Attorney General this week lending two cryptocurrencies ordered the platform to cease its activities, from three lending platforms requested information about their activities.
Celsius Network announced that it was one of the companies requested information.
As of writing, Tether has not responded to the question we sent to them for information on the subject.