Tether's commercial paper holdings have decreased by 17% in Q1 2022.

Regulators worry as UST's de-pegging 'LUNA-cy' emerges.

Tether is fully backed, and the makeup of its deposits is strong, conservative, and liquid, according to this latest attestation.

Tether (USDT), the USDT stablecoin issuer, has revealed that in the first quarter of 2022, it reduced its reserves allocation to commercial paper investments and raised its allocation to US Treasury bills.

Tether announced on Thursday that its reserves were "fully backed," presumably to satisfy many users' concerns about USDT momentarily de-pegging from the dollar on May 12. According to the stablecoin issuer, its commercial paper holdings dropped 17 percent in Q1 2022, from about $24 billion to $20 billion, with a further 20% drop expected in the firm's next quarterly report. Over the same quarter, Tether raised its investments in money market funds and US Treasury bills by 13%, from $34.5 billion to $39 billion.

Tether has remained stable despite numerous black swan events and very volatile market conditions, and it has never failed to honour a redemption request from any of its verified consumers. Tether is fully backed, having a robust, conservative, and liquid reserve composition, according to the latest attestation.

Tether is compelled to reveal its reserves every quarter as part of a $18.5 million settlement with the Office of the New York Attorney General in February 2021, in which authorities claimed the firm misrepresented the degree to which its USDT stablecoins were backed by fiat collateral. In February, the business announced that it would reduce its commercial paper reserves allocation in Q4 2021 from around $30 billion to $24 billion, a 20% reduction.

USDT has a market capitalization of moreover $74 billion, which is higher than Tether's reported reserve assets of more than $82 billion at the time of writing. Tether repeated that it will "respect all redemptions from verified customers" for USDT during the recent severe volatility in the crypto market, perhaps in an effort to prove the asset was as stable as its namesake.