Re:Tether Withdrawals Top $10B
by Majromax on Tuesday May 24, 2022 @03:54PM
(#31496802)
> If you are tether and your asserts are in bonds that mature in under N days, then you could just promise redemption within N days to eliminate bank run risk.
I don't think that's reasonable for Tether, at least not with a bulletproof N. I can't quickly find any specific redemption guarantee, but their March reserves report notes that their US Treasuries (the largest single claimed category) can have maturities up to 120 days. The commercial paper category claims an average duration of 44 days.
Re:Tether Withdrawals Top $10B
by datadata on Tuesday May 24, 2022 @07:58PM
(#31498988)
Agreed, I think N would have to be too high to depend on this entirely, and high N looks a lot like insolvency. But it could still buffer against a partial bank run.
I don't think that's reasonable for Tether, at least not with a bulletproof N. I can't quickly find any specific redemption guarantee, but their March reserves report notes that their US Treasuries (the largest single claimed category) can have maturities up to 120 days. The commercial paper category claims an average duration of 44 days.