Tether CEO Slams BIS: Stablecoin Full Reserves Show It’s Tokenized Deposits That Expose Bank Reserve Risks

In response to recent warnings from Bank for International Settlements (BIS) General Manager Pablo Hernández de Cos regarding the potential risks stablecoins may pose to financial stability, Tether CEO Paolo Ardonio lashed out at the BIS on the X platform. He stated that stablecoins and tokenized bank deposits have fundamentally different underlying risk structures. Stablecoins are essentially instruments fully backed by 100% reserves of highly liquid assets, such as U.S. Treasury securities. By contrast, tokenized bank deposits remain deposits within the banking system and typically operate under a fractional reserve model, where only a portion is backed by highly liquid assets.