Celsius bankruptcy report by court-appointed examiner Shoba Pillay either has a typo, or a mischaracterization, Tethers chief technology officer stated. 605 Total views 3 Total shares Listen to article 0:00 News Own this piece of history
Collect this article as an NFT According to its chief technology officer, the company behind Tether (USDT), the worlds largest stablecoin by market capitalization, has never received any loan from the bankrupt cryptocurrency lender Celsius.
Paolo Ardoino, the chief technology officer at Tether and Bitfinex crypto exchange, took to Twitter on Jan. 31 to announce that Tether has never borrowed from Celsius.
The tweet came in response to the Celsius bankruptcy examiner report, which allegedly mistakenly implied that Tether was among Celsius borrowers alongside firms like Three Arrows Capital, which borrowed $75 million from the firm.
Released on Jan. 31, the examiner report mentionedon page 183 that Celsiuss loans to Tether were twice its credit limit.
The report notes that Tethers exposure eventually grew to over $2 billion, which became an issue in late September 2021 when it was described to the risk committee as presenting an existential risk to Celsius.
Denying any exposure to troubled Celsius, Ardoino suggested that examiner Shoba Pillay mixed up prepositions in the examiner report, actually meaning Celsius loans from Tether instead of Celsius loans to Tether.
Either is a typo or a mischaracterization, Tethers chief technology officer wrote in a Twitter thread started by Financial Times reporter Kadhim Shubber.
Shubber also mentioned that the examiner report is associated with some level of miscomprehension, stating:
The examiners report above describes Celsius having loans to Tether, but I think the exposure comes from Celsius having posted collateral in excess of the amounts it borrowed from Tether.
As previously reported, Celsius allegedly borrowed $1 billion from Tether with Bitcoin (BTC) in 2021. Celsius founder Alex Mashinsky stated that the company was paying an interest rate of between 5% and 6%. In June 2022, Tether said it liquidated the $900 million loan, which came about a month after Celsius halted withdrawals.
Related: Celsius publishes list of users eligible to withdraw majority of assets
According to the latest examiner report, the loan amount was much larger than $1 billion. Celsius had borrowed $1.823 billion of the stablecoin USDT from Tether, posting as collateral $2.612 billion of its assets under management, examiner Shubber wrote, adding that the collateral amounted to 17% of all Celsius assets.
Apart from providing massive loans to Celsius, Tether is known as an early investor in the bankrupt firm. In 2020, Celsius secured a $10 million equity raise from Tether, with Mashinsky highlighting it as an important endorsement by the firm. #Cryptocurrencies #Business #Tether #Stablecoin #Regulation #Celsius Related News What is Solana (SOL) Pay, and how does it work? Opinion: Have Brazils Lula and Argentinas Fernandez heard of cryptocurrency? FTX lawyers: Examiner could cost $100M and provide no benefit Algorithmic stablecoin market share dropped by 10x from ATH: Report Binance stablecoin BUSD sees a sharp market cap drop amid solvency and mismanagement worries
