The annual Tether skepticism is back again. Let’s start with the facts: Based on Tether’s disclosed reserve structure, USDT has indeed long faced a structural mismatch between assets and liabilities (USDT issuance). This isn’t about insufficient capital (current equity/total assets is around 3.7%), but rather a mismatch: for every 1 USDT liability, there’s approximately $1.037 in assets backing it. Of this, $0.88 is in highly liquid USD assets (like U.S. Treasuries), and $0.15 is in high-volatility assets (BTC + gold). Arthur’s analysis suggests that if BTC/gold were to drop significantly, this $1.037 in assets could fall below the $1 liability, making USDT undercollateralized. Logically, this argument holds. Tether allocating part of its reserves to BTC/gold instead of fully backing with highly liquid USD assets is indeed problematic. This is also the core reason why it cannot achieve compliance in the U.S. or Europe. For every 1 USDT it mints, not only does it pocket all the Treasury interest, but it also makes holders provide $0.15 worth of BTC/gold leverage for free. That said, I think the market’s concerns are still overblown. Tether’s disclosure is a reserve report, not a full financial statement. The biggest uncertainty here is dividends. Over the past nine months, it has distributed about $10 billion in dividends (e.g., profits paid to its parent company). Considering the high-interest rate cycle in recent years, it’s reasonable to speculate that it has offloaded $20-30 billion in equity through dividends, which isn’t reflected in the current reserve report. If this equity still exists within the group’s system, its real safety cushion might be far higher than the surface numbers suggest. But that being said, Tether’s scale has grown to a global systemic level. Achieving true 100% USD backing is far more important than using users’ minted funds for directional bets. This annual FUD damages the brand, and the extra gains from these practices, as the Chinese saying goes, feel a bit like “picking up sesame seeds while losing a watermelon.” #Tether #USDT #Crypto #FUD