Tether Chief Executive Officer Paolo Ardoino said on Aug. 31 that stablecoin technology has changed how U.S. Treasuries are held by spreading exposure across a far larger base of holders. According to Ardoino, Tether has helped make Treasury ownership more decentralized, which he argued makes the structure of U.S. debt holdings safer.
He contrasted that model with a scenario in which hostile countries hold hundreds of billions of dollars in Treasuries, where a single decision-maker could unload large positions in a short period of time and create risks for the U.S. financial system. By comparison, Ardoino said the Treasuries backing Tether’s stablecoins are indirectly held by about 650 million people. Because those investors would not all decide to sell at once, he said, the risk of concentrated dumping is lower.
Ardoino also said that decades of what traditional finance called financial innovation did not solve this issue, while stablecoin technology has for the first time enabled broader and more distributed ownership of U.S. Treasuries.
Tether CEO Paolo Ardoino said on Aug. 31 that Tether is using stablecoin technology to push U.S. Treasuries toward what he described as decentralized ownership, making the holder structure of U.S. debt safer.
Ardoino said that if hostile countries were to hold hundreds of billions of dollars in U.S. Treasuries, a single decision-maker could sell a large amount in a short period of time, creating risk for the U.S. financial system.
He contrasted that with the Treasury exposure behind Tether’s stablecoins. According to Ardoino, the number of holders is large, with roughly 650 million people indirectly holding the related U.S. Treasury assets. Those investors would not all make a sell decision at the same time, he said, which lowers the risk of concentrated selling.
Ardoino added that traditional finance, after decades of what he called financial innovation, had not solved this problem, while stablecoin technology had for the first time enabled broader and more distributed ownership of U.S. Treasuries.
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