Can't USDT fall? Wall Street bond trading giant Cantor acquires 5% stake in Tether

Wall Street bond trading giant Cantor Fitzgerald is rumored to have reached an investment protocol with Tether, the leading stablecoin issuer of USDT, in 2023, acquiring a 5% stake in Tether. This comes as Cantor Fitzgerald CEO Howard Lutnick was recently appointed as the new U.S. Secretary of Commerce by Donald Trump, which could mean that Tether will receive more political support in the future. According to The Wall Street Journal, Cantor Fitzgerald has reached an investment protocol with Tether, acquiring a 5% stake in the leading stablecoin issuer in 2023. This 5% stake is valued at up to $600 million at the time of signing the protocol. With the recent announcement by President-elect Trump appointing Cantor Fitzgerald CEO Howard Lutnick as Secretary of Commerce, it is possible that Tether will receive more political support in the upcoming Trump administration. Lutnick to assist Tether with more support? The report mentions that Howard Lutnick, as an advisor to the Trump transition team, is working closely with Trump to help select other high-level government positions responsible for regulating Tether. Giancarlo Devasini, one of Tether's largest shareholders, reportedly privately claimed earlier this year that Howard Lutnick would use his political influence to try and resolve the threats facing Tether. Previously, there has been constant fear, uncertainty, and doubt surrounding Tether, with its financial audits being questioned. Recently, the U.S. Southern District of New York's prosecutor's office reportedly launched a criminal investigation into the use of Tether by third parties to fund illegal activities or money laundering. At a time when many banks around the world have cut ties with Tether, Cantor Fitzgerald has become one of Tether's most important banking partners. Howard Lutnick has long been a supporter of cryptocurrencies, and since 2021, his firm Cantor Fitzgerald has been managing Tether's U.S. Treasury investment portfolio. According to Tether's latest reserve report for the third quarter of 2024, Tether's reserve assets are $125.5 billion, with liabilities of $119.4 billion, resulting in an excess reserve of over $6 billion. Tether currently holds over $105 billion in cash and cash equivalents, with the amount of U.S. Treasury bonds held directly and indirectly reaching $102.5 billion, making Tether the 18th largest holder of U.S. Treasury bonds globally, ranking higher than Germany, Australia, and the United Arab Emirates. Howard Lutnick has repeatedly expressed confidence in the financial soundness of Tether, stating in January of this year, 'I manage many assets of Tether and we have done a lot of work. Tether has the funds they claim to have... and we have seen that they do indeed have these funds.' Tether denies that Lutnick will provide assistance. In response to The Wall Street Journal's report, a Tether spokesperson stated that the relationship between Tether and Cantor Fitzgerald is purely a business relationship based on reserve management. The spokesperson claimed that Howard Lutnick's joining the transition team does not imply any influence on regulatory actions and is baseless. Cantor Lutnick stated that after approval by the Senate, he will resign from his positions at Cantor Fitzgerald and other companies, divest his interests in the company, and comply with ethical standards set by the U.S. government, and does not expect any arrangements involving the sale of stocks on the public market. Nevertheless, the biggest concerns in the market about USDT have always been its transparency, the authenticity of its reserves, and potential regulatory risks, believing that Tether will one day collapse. However, the current situation seems to indicate that with enhanced financial stability, deeper connections with traditional finance and the political sphere, Tether seems to be too big to fail. Related reports: Tether earns $2.5 billion net profit in Q3 with gold and U.S. bonds! U.S. Treasury Department advocates for CBDC to replace stablecoins, Tether's collapse would be a national debt disaster. Tether CEO: The U.S. government can kill USDT with a push of a button, will not confront the authorities. This article was originally published on BlockTempo.