Tether CTO Denies Borrowing From Celsius

Tether’s (USDT) CTO Paolo Ardoino denied that Tether had borrowed from Celsius in his post on Twitter.

Tether’s (USDT) CTO Paolo Ardoino denied that Tether had borrowed from Celsius in his post on Twitter.

Tether’s CTO noted that there was either a typo or a misidentification in the Celsius bankruptcy report of court-appointed auditor Shoba Pillay. According to the CTO, Tether has never borrowed money from Celsius. Paolo Ardoino, who is also the CTO of the Bitfinex platform besides Tether, announced on Twitter that Tether has never borrowed from Celsius.

Paolo Ardoino Clarifies the Situation

Paolo Ardoino made the statement on Twitter on behalf of Tether, which is implied to be among the borrowers from Celsius.

On page 183 of the review report, published on January 31, it was stated that Celsius’s credits to Tether were twice the credit limit. According to the report, Tether owes Celsius more than $2 billion, which is seen as an existential threat to the lender’s financial health.

Stating that they do not owe Celsius, Ardoino suggested that auditor Shoba Pillay confused the prepositions in his report, which actually meant “Celsius credits from Tether” rather than “Celsius credits to Tether”.

“either a typo or a misidentification,” Tether CTO Ardoino wrote in a tweet thread started by Financial Times reporter Kadhim Shubber. Shubber pointed out that there may be a misunderstanding in his post and said:

“The review report above explains that Celsius owes Tether, but I think the risk comes from Celsius issuing more collateral than it borrows from Tether.”

As previously reported, Celsius allegedly borrowed $1 billion from Tether with Bitcoin. Founder Alex Mashinsky stated that in 2021 Celsius pays an interest rate of between 5 percent and 6 percent. In June 2022, Tether said it had liquidated $900 million in loans, which came about a month after Celsius stopped withdrawals.

According to the most recent review report, the amount of the loan was much more than $1 billion. Auditor Shubber: “Celsius borrowed $1,823 billion in stablecoins (USDT) from Tether and pledged $2,612 billion of assets under management.”he wrote, noting that collateral makes up 17 percent of Celsius’ all assets.

Tether is among the early investors of the bankrupt company, as well as providing large loans to Celsius. Celsius raised $10 million in funding from Tether in 2020.