Cantor Fitzgerald CEO Howard Lutnick has provided strong validation for stablecoin issuer Tether, addressing one of the major concerns surrounding the cryptocurrency. In an interview with Bloomberg TV, Lutnick vouched for Tether’s legitimacy, stating, “They have it,” in reference to the money the stablecoin claims to have.
Lutnick’s endorsement carries significant weight, as Cantor Fitzgerald is a well-known bond trading house on Wall Street and one of the 25 primary dealers for U.S. Treasurys, allowing direct trade with the Federal Reserve. His statement comes at a time when Tether’s stablecoin, USDT, has grown into a behemoth with over $95 billion in market capitalization, making it the most widely used stablecoin in the world.
The backing of USDT has long been under scrutiny, with observers expressing concerns about the assets supporting the stablecoin. However, Tether’s latest attestation report, which showed $86.4 billion of assets in reserves as of September 30, indicates that USDT is primarily backed by U.S. Treasuries, considered among the safest assets globally. The report also revealed that Tether no longer holds any commercial paper, which had previously raised concerns.
Despite these developments, the industry remains skeptical about the quality of Tether’s assets. Recently, credit rating agency S&P Global gave the stablecoin a poor score, highlighting concerns about the asset backing, as well as weaknesses in areas such as regulation, governance, transparency, liquidity, redeemability, and track record. Additionally, users of USDT are eagerly awaiting an official audit that would provide a more precise picture of the company’s financial situation.
Lutnick’s support for Tether is not new, as Cantor Fitzgerald serves as a custodian for the stablecoin issuer’s Treasuries. However, he also expressed his skepticism about the value of bitcoin and stablecoins for Americans, viewing them primarily as speculative assets. Lutnick argued that in countries like Argentina, Venezuela, and Turkey, where economic instability is prevalent, crypto assets and stablecoins hold more substantial importance as a means to hold onto the dollar.
The controversy surrounding Tether’s stablecoin assets has been a topic of discussion in the crypto community for years. Lutnick’s endorsement provides a vote of confidence from a prominent Wall Street figure, but the industry still awaits further transparency and scrutiny to fully assess the quality and legitimacy of Tether’s assets.