If you’re invested in crypto but keeping a good amount on the sidelines as “dry powder” in stablecoins, you might be wondering… is your USDT or USDC actually even safe right now amid the FTX implosion debacle?

In other words, do these major stablecoins have overexposure risk to the potentially broad-reaching, mind-boggling FTX fall from grace, and could they be affected in a potential crypto-contagion collapse?

While nothing, absolutely nothing, can now surprise us any more when it comes to crypto transparency, or lack thereof, Tether and Circle, the two separate issuers of the market-leading, centralised, US-dollar-pegged stablecoins USDT and USDC, have both moved to allay those sorts of fears.

Let’s take a look at what’s they’ve both said.


Circle’s USDC

We’ll start with Circle’s USDC stablecoin, which has a market cap of just over US$43.1 billion.

Circle CEO Jeremy Allaire took to Twitter this morning (AEDT) in what he wrote was an attempt to “dispel the noise” and the FUD (fear, uncertainty and doubt).

In his thread, Allaire noted that FTX has been a customer of Circle payments for more than 18 months, providing card and ACH services for customer transactions, adding that Circle’s crypto payments beta product uses FTX and other exchanges for BTC/ETH liquidity.

Alameda Research, meanwhile, has been a Circle customer “for many years”, the CEO explained, using Circle’s USDC service for creating and redeeming the stablecoin. Alameda is FTX boss Sam Bankman-Fried’s trading and venture firm, and is at the centre of the FTT overexposure problem that contributed to the “liquidity crunch” and FTX bank run on user funds.

Allaire revealed, however, that Circle has never made loans to Bankman-Fried’s two companies and has never received FTX’s native token, FTT, as collateral, nor has it ever traded or held a position in FTT.


Tether’s USDT

Out of the top two stablecoins, Tether’s USDT (market cap: US$68.5 billion) is the one that far more frequently comes under scrutiny and criticism for its supposed lack of transparency. Tether “FUD” has been flying around for literally years now.

Like Circle’s Allaire, Tether CTO Paolo Ardoino also jumped onto Twitter, where he’s a frequent poster, and clarified that the stablecoin issuer also does not have exposure to FTX or Alameda.

It’s true that Alameda has previously redeemed a lot of USDT, confirmed Ardoino, but he claims that “no credit exposure has matured”.

Ardoino is clearly sick of the speculation, as this following tweet suggests – which was in response to some more FUD and alleged hefty Alameda exposure, perpetuated in the odd corner of Crypto Twitter today.

In an update to this story, Tether has now published its latest quarterly attestation, emphasising the “extremely liquid” nature of its assets.

As of September 30 this year, 82% of Tether’s reserves were held in cash, cash equivalents and other short-term deposits, the company disclosed in its quarterly report.

Meanwhile, the stablecoin issuer reports that its exposure to commercial paper – short-term corporate debt – has fallen to only 0.07% of its holdings.

United States Treasury Bills now reportedly make up more than 58% of Tether’s reserves.