Tether Just Opened A $1.8 Billion Bank Account In The Bahamas

In the latest news centered around dollar-pegged stablecoins on our DC Forecasts crypto news site, we have Tether Limited, the organization behind the USD-pegged cryptocurrency stablecoin Tether (USDT) – and its recent partnership with a small financial institution based out of the Bahamas.

According to the newly established relationship, the cryptocurrency firm which is known for its opaque operations, has broken out from standard practice on Thursday and publicly announced that it has formed a banking partnership with Deltec Bank, a 72-year-old financial institution located in Nassau.

We are pleased to be able to confirm that Tether has an account with Deltec Bank & Trust Limited https://t.co/LSn64soUsC . Balance confirmation at 2018-10-31 attached.

— Tether (@Tether_to) November 1, 2018

As you can see from the official announcement which was shared on Tether’s website, the company states that Deltec had only opened the account after a several month review that included full evaluation of whether the company could maintain the USDT token’s $1.00 peg. We all know that this peg has declined in recent weeks, even though the company redeemed more than $1 billion worth of the token since the beginning of October.

The announcement further reads:

“The acceptance of Tether Limited as a client of Deltec came after their due diligence review of our company. This included, notably, an analysis of our compliance processes, policies and procedures; a full background check of the shareholders, ultimate beneficiaries and officers of our company; and assessments of our ability to maintain the USD-peg at any moment and our treasury management policies. This process of due diligence, was conducted over a period of several months and garnered positive results, which led to the opening of our bank account with this institution. Deltec reviews our company on an ongoing basis.”

Tether also published a letter from Deltec which confirms that the firm – accused by some of operating a fractional reserve – is holding $1.83 billion at the bank which is more than enough to cover the assets backing the 1.78 billion in outstanding USDT.

“We hereby confirm that, as at the close of business on October 31, 2018, the portfolio cash value of your account with our bank was US$1,831,322,828.

“This letter is provided without any liability, however arising, on the part of Deltec Bank & Trust Limited, its officers, directors, employees and shareholders, and is solely based on the information that is currently in our possession.”

Tether’s relationship with Deltec had first been reported by The Block. Previousl, the company was said to be banking at the Puerto Rico-based Noble Bank, which is now for sale following the departure of the stablecoin and other large crypto industry clients.