Howard Lutnick, CEO of Wall Street firm Cantor Fitzgerald, has expressed strong support for the USDT stablecoin issued by Tether, highlighting his confidence in the company and its financial backing. In a December 11 interview with CNBC, Lutnick emphasized his trust in Tether, noting that he personally holds their treasuries and is impressed by their substantial holdings, which he mentioned have surpassed $90 billion.
Cantor Fitzgerald’s involvement with Tether is significant, as the firm has been managing Tether’s multibillion-dollar United States Treasury portfolio for several years. This partnership, which reportedly began in late 2021 according to a Wall Street Journal report, is notable because many Wall Street firms have been cautious about engaging with crypto businesses, especially in the wake of incidents like the Silicon Valley Bank crash.
Cantor Fitzgerald is among the few brokerage firms capable of trading Treasury bonds, a group that includes other major players like Charles Schwab, Fidelity, and Vanguard. This capability positions Cantor Fitzgerald uniquely in the intersection of traditional finance and the emerging crypto sector.
Despite Tether’s prominence as the largest stablecoin by market cap, it has faced criticism and skepticism regarding the transparency of its reserves. This concern was reflected in a recent assessment by S&P Global, where Tether received a relatively low ranking among U.S. dollar-pegged stablecoins. The assessment considered factors such as asset management, audits, risk appetite, redeemability in the primary market, payment rails in the secondary market, and the track record of maintaining its U.S. dollar peg.
Lutnick, however, sees potential for Tether in economically unstable countries like Argentina. He suggests that Tether could play a role in countries looking to dollarize their economies, especially in situations where traditional banking systems are failing or unreliable. This view aligns with comments from James Check of Glassnode, who referred to Tether as a sort of “CBDC” (Central Bank Digital Currency) that could be increasingly used by developing countries seeking to adopt the U.S. dollar.
In addition to his comments on Tether, Lutnick also expressed his views on cryptocurrencies more broadly. While initially stating he was a fan of crypto in general, he later specified his preference for Bitcoin, citing its halving cycles and the absence of a centralized controlling entity as key reasons for its value. He contrasted Bitcoin with other cryptocurrencies, which he viewed as less substantial, though he conceded that Ethereum might be an exception. Lutnick highlighted Bitcoin’s unique attribute as an asset that cannot be controlled or seized, in contrast to assets like Tether or Ethereum, which have mechanisms for intervention or control by their respective organizations.
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