Tether Partners with Bahamas' Britannia Bank for Dollar Transfers
Tether, the issuer of the widely used stablecoin USDT, has reportedly established a partnership with Britannia Bank & Trust, a private bank based in The Bahamas, to facilitate dollar transfers on its platform. According to sources familiar with the matter, Tether has directed its clients to send funds to Britannia's bank account over the past few months, as revealed by a Bloomberg report on August 29. While the exact commencement date of Tether's collaboration with Britannia Bank remains undisclosed, the stablecoin issuer has been known to work with other banking entities such as Deltec Bank and Capital Union Bank. In recent times, cryptocurrency companies in the United States have increasingly sought international banking partners due to growing regulatory scrutiny from U.S. authorities.
This trend gained momentum after the unexpected collapse of FTX in November, prompting American crypto firms to explore offshore banking relationships. Tether has faced criticism and skepticism in the industry for its lack of transparent disclosure regarding its balance sheet and banking affiliations. This lack of transparency has led to concerns and doubts about how Tether manages its substantial $86 billion in assets.
Tether's USDT currently holds a dominant position in the stablecoin market, boasting a market capitalization of $82.9 billion, which accounts for 66.5% of the total market, as reported by CoinGecko. USDT's market capitalization experienced a surge of over 20% to reach $80 billion in the first four months of 2023, a period marked by a banking crisis involving Silvergate Bank, Signature Bank, and Silicon Valley Bank. However, the market capitalization has since stabilized at approximately $80-82 billion. As Tether continues to expand its network of banking partners, the stablecoin's influence on the cryptocurrency ecosystem remains substantial. The partnership with Britannia Bank signals a strategic move to enhance the efficiency of dollar transfers within the realm of stablecoins, contributing to the ongoing evolution of the digital financial landscape.