Tether faces exposure as EQIBank faces liquidation risk

Tether has funds held at EQIBank, an offshore digital bank currently facing liquidation risk following asset seizures by U.S. authorities. The seizure involves approximately $89 million taken from accounts linked to a payment provider, Capstone Ltd.

EQIBank, which is licensed in Dominica, reports that the frozen funds were held at Wells Fargo and JPMorgan Chase. The bank has warned that these seizures, which represent a significant portion of its holdings, could lead to formal liquidation proceedings.

Tether has stated that the affected funds represent less than 0.034% of its total assets. Despite the potential counterparty risk, major cryptocurrencies like Bitcoin and Ethereum have remained relatively stable in response to the news. The situation has raised questions regarding the concentration of stablecoin reserves within offshore banking institutions.