USDT withstands 25% redemption wave with full payment, while traditional banks face consecutive crises?

Question

Recently, I came across an interesting data comparison - an analyst compared the redemption pressure test of USDT with the bank run situations of several traditional banks.

The result is quite striking: Tether managed to handle full redemptions during a 20-25% bank run, while Silicon Valley Bank collapsed after only 25%, and First Republic Bank couldn't hold up after 57%. This gap is indeed something to note.

Looking at the asset allocation now, 77% of USDT is in cash-like assets, with the remainder in gold and Bitcoin, resulting in an overall excess collateral of 3%. According to their calculations, even if volatile assets plummet by 30% in extreme market conditions, USDT is still backed by 95% real assets.

Of course, this is not to say that stablecoins are in a safe position. But at least in terms of reserve transparency and stress resistance, the data is here, and it is indeed much more reliable than the operations of some traditional financial institutions.

NFTRegretDiary · Accepted Answer

This data is a bit harsh, traditional banks are being rubbed on the ground.

This wave of USDT operations is indeed worth watching, the transparency surpasses TradFi by several streets.

Wait a minute, they said over-collateralization is 3%? This number feels a bit conservative.

Banks are still playing tricks, but stablecoins have already been listed.

However, we still need to keep a close eye on it, or else something unexpected might happen again.

MetaMaximalist · Answer

yeah so the fact that tether actually held the line while svb face-planted is kind of the whole point everyone's been missing, honestly

rugdoc.eth · Answer

It&#39;s really outrageous, traditional banks go down with a 25% bank run, but USDT holds strong, what a contrast...

Tether&#39;s operations this time are indeed impressive, with 77% cash-like assets well-prepared.

Those old fossils at Silicon Valley Bank are directly outclassed in transparency compared to the crypto world.

The claim of 95% real cash sounds great, but I still want to see on-chain data to verify it.

However, it must be said that the risk management of traditional banks is indeed disappointing, I have to admit this.

liquidation_surfer · Answer

Traditional banks really flopped this time, they are not as strong as a stablecoin.

Silicon Valley Bank collapsed at 25%? Tether held strong, this data comparison is indeed a bit ironic.

USDT&#39;s 77% cash asset allocation is indeed much cleaner compared to the messy asset pools of some banks.

That being said, high transparency makes you a winner, at least you can see the real cash there.

Now those who criticized stablecoins should shut up, the reality is right in front of them.

NeverVoteOnDAO · Answer

Haha, it&#39;s this trap comparison again. Wow, USDT really is tough this time.

Wait, is the data real? Why do I feel like Tether&#39;s transparency has always been a mystery...

95% real assets? What about the remaining 5%? That&#39;s the key point, okay?

But then again, traditional banks have indeed been disappointing, and the Silicon Valley Bank incident is still fresh in my mind.

Even if USDT is reliable, I wouldn&#39;t dare to go all in. This thing still needs to be approached with caution.