Tether said that although the Celsius crypto lending platform is part of its investment portfolio, adverse events did not affect the financial stability of the USDT stablecoin issuer.

Celsius Feels Impact of Market Volatility, Tether Keeps Reserves Strong https://t.co/7Rzpga1Lmx

— Tether (@tether_to) 13 June 2022

On June 13, Celsius suspended withdrawals, swaps and transfers between accounts. In the past 24 hours, the CEL token has lost about 41% in price and is trading near $0.21 (CoinGecko).

Rival service Nexo has already announced that it is ready to acquire Celsius’ loan portfolio.

Tether described the events that affect the effectiveness of the platform as “the result of volatility and extreme market conditions.”

Bitcoin price has dropped more than 13% in one day. At the time of writing, digital gold prices are around $23,700. The total capitalization of the crypto market has dropped below $1 trillion.

In October 2021, Bloomberg reported that Tether has lent its lending platform a total of approximately 1 billion USDT at a rate of 5-6% annually.

“Tether’s lending activity with Celsius (as with any other borrower) has always been over-collateralized and did not affect our reserves,” the company said.

At the time of writing, there are approximately 72.3 billion USDT in circulation. The second largest stablecoin USDC pegged to the dollar, Circle has an offering of 54.5 billion coins.

Recall that in May Tether announced that it has transferred most of its USDT collateral to US Treasury bonds.