What is USDT and how does it work?

USDT is a centralized cryptocurrency. That simply means that a single authority — such as a government, bank, or company — issues and controls the currency. If you have a debit card or credit card in your wallet, the issuing bank or company is the centralized authority.

What is commercial paper?

Commercial paper is a short-term, unsecured debt instrument with a duration of 1-270 days. Financial institutions and large corporations are the main issuers of commercial paper because they have high credit ratings. There is trust in the market that they will repay unsecured promissory notes of this nature.

Who is the centralized authority for USDT?

If you have a debit card or credit card in your wallet, the issuing bank or company is the centralized authority. For USDT, the Tether tokens are issued by Hong-Kong-based Tether Limited, which, in turn, is controlled by Bitfinex/iFinex Inc.

Will tether cut its holdings of commercial paper further?

But Ardoino said Tether, the issuer of the USDT stablecoin, will cut its holdings of commercial paper further than the current 30% of total reserves.