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Tether and US Federal Reserve Fired Up Money Printers in March

2 mins
Updated by Ali Martinez
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In Brief

  • Amid turmoil in the banking sector, Tether printed billions in USDT as demand surged.
  • The Fed has flooded the market with liquid cash but cannot quell investor fears about traditional banking.
  • Tether proves resilient in the face of relentless attacks from investigative media.
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Tether, the company behind the most-used stablecoin in the crypto market, minted 9.7 billion USDT in March. This figure is quite impressive when considering the U.S. Federal Reserve printed $400 billion during the same period.

The output of Tether’s stablecoin is a sign of surging investor demand amid the banking crisis enveloping Silicon Valley Bank, Silvergate, Signature Bank, and First Republic Bank. Not to mention the fall of Swiss-based Credit Suisse and its bailout by rival UBS.

These developments have shaken confidence in banks while driving the Federal Reserve to pump out $400 billion of liquidity in two weeks.

U.S. Federal Reserve Balance Sheet
U.S. Federal Reserve’s Balance Sheet. Source: FRED

This perfect storm has proven to be a boon for stablecoins and other digital currencies. The stablecoin issued by Hong Kong-based Tether has met increasing demand in the face of attacks in the legacy media.

Tether (USDT) Market Cap Crypto
Tether (USDT) Market Cap. Source: CoinMarketCap

U.S. Targets Crypto Giant Tether’s USDT

Among the harshest critics is the Wall Street Journal, which has linked Tether to shady businesses and to terrorism. In recent months, the media conglomerate has published numerous stories questioning the legitimacy of USDT.

On March 3, the Wall Street Journal published an exposé about companies dealing in Tether and sister exchange Bitfinex. It detailed their efforts to stay connected to the global banking system. Backers of Tether, the article claimed, were resorting to fraud.

Allegedly they falsified documents and used shell companies in the face of a Justice Department’s investigation. The Manhattan US District Attorney’s office is spearheading the investigation.

“The companies often hid their identities behind other businesses or individuals,” the Journal’s report stated. “Using third parties occasionally caused problems, including hundreds of millions of dollars of seized assets and connections to a designated terrorist organization.”

Tether has hit back hard against these allegations and those in other recent stories. It states on its website that the Journal has been selective about what firms to investigate.

“Tether continues to be the target of outdated, inaccurate, and misleading coverage and allegations from the Wall Street Journal,” Tether states. “As the high-profile failures of FTX, Celsius, and Genesis among others revealed, they have rarely focused on the right targets.”

The stablecoin giant maintains that “biased coverage” from legacy media outlets will not stop it from continuing to build a global financial infrastructure. Still, Tether did not respond by press time to a request for comment.

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Michael Washburn
Michael Washburn is a New York-based managing editor who joined BeInCrypto in March 2023. Over his career, he written extensively about the corporate legal world and the intersection of finance and law, has produced thousands of articles and features, and has mentored many reporters and researchers finding their way in a fast-changing industry.
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