The shorting of the USDT stablecoin is on the rise among crypto-focused hedge funds amid negative market activity and the collapse of the Terra ecosystem. The Wall Street Journal writes about it.

According to the publication, traditional hedge funds were short traded a month ago through Genesis Global Capital. Leon Marshall, the company’s head of corporate sales, rated the deals at “hundreds of millions” of dollars.

“There has been a real surge of interest from traditional hedge funds that are watching and trying to sell Tether,” he said.

According to Genesis, the dynamics began to be watched after the collapse of the UST algostablecoin. Against the backdrop of market turbulence, USDT briefly diverged from its stable price to the US dollar. The coin is currently priced at $1 and has a market cap of ∽67 million (CoinGecko).

According to Marshall, some hedge funds sell USDT “as a solution for the economy as a whole” because fed on the way to raise the key rate. Others are concerned about the quality of assets in stablecoin reserves.

In May, Tether Holdings Limited announced that it had reduced its USDT collateral in commercial securities by 17%. The company later denied rumors that it was dominating the reserves of Chinese commercial paper.

On June 18, the stablecoin issuer’s website was subject to a large-scale DDoS attack. The company’s technical director, Paolo Ardoino, ruled out the impact of the event on the ability to use positions in USDT.

Recall that Tether refused to lay off employees despite the negative situation in the cryptocurrency market.

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