S&P Global: Downgrades USDT's ability to maintain its peg to the US dollar to the lowest rating

According to Bloomberg, S&P Global Ratings has downgraded Tether's ability to maintain its USDT stablecoin's peg to the US dollar to the lowest rating, warning that a decline in Bitcoin prices could lead to the risk of under-collateralization for the stablecoin.

On Wednesday, analysts at the rating agency lowered the stability rating of USDT from "limited" to "weak." S&P stated that this assessment "reflects the increased exposure to high-risk assets in USDT reserves over the past year," which include Bitcoin, gold, secured loans, and corporate bonds, while also considering the limited nature of the disclosed information.