Tether has paid out over $10bn in withdrawals since the start of the crypto market crash in early May.
At the time of publishing, Tether’s USDT market capitalisation was at $73.21bn after an all-time high of $84.15bn on 12 May.
The cryptocurrency’s crash comes following the collapse of algorithmic stablecoin TerraUSD, that is meant to be pegged to the US dollar, which traded at $0.0647 on Monday morning Asia time.
USDT, which is meant to always be worth $1, slipped below this peg earlier this month following the collapse of rival token TerraUSD.
The cryptocurrency’s drop in total market value follows Tether’s redemption programme which allows users to trade in USDT for fiat currency.
About $1bn was redeemed after midnight on Saturday, according to public blockchain data.
Another $1.5bn was redeemed in the same way three days earlier, the Guardian reported.
The latest redemption follows Tether’s release of its most recent audited financial statements at the end of March.
The statements show that the company had secured user deposits with US government bonds, other private corporate bonds, and various other investments worth about $5bn.
Tether originally said its reserves were backed by US dollar one-on-one, but after an investigation by the New York Attorney General, the company said it was not always the case and that the cryptocurrency was just backed by “Tether’s reserves”.
In the latest quarterly report, disclosing what these reserves contain, Tether said it holds about $20bn of its cash in commercial paper, $7bn in money market funds, and about $40bn in US government bonds.
“Tether has maintained its stability through multiple black swan events and highly volatile market conditions and, even in its darkest days, Tether has never once failed to honor a redemption request from any of its verified customers,” Paolo Ardoino, Tether’s chief technology officer had said.
“This latest attestation further highlights that Tether is fully backed and that the composition of its reserves is strong, conservative, and liquid,” he had said last week.