Holding US Treasury bills does not guarantee that the largest stablecoins are entirely safe. Tether and Circle remain vulnerable to a sudden liquidity crisis, warned Christoph Hock, Head of Tokenization and Digital Assets at Union Investment, during the Digital Money Summit 2026, CoinDesk reports.
According to the analyst, it is too early to consider USDT and USDC as fully-fledged equivalents to traditional fiat money for settlements. The structure of their reserves raises concerns: rather than resembling conservative, protective instruments, it exhibits traits characteristic of speculative funds.
The Illusion of Stability and Market Risks
The primary flaw in the current model of stablecoin issuers is the shifting of market risks onto the end-users. In times of market panic, when investors rush to convert their holdings into hard cash simultaneously, the system might fail to withstand the pressure.
As a cautionary example, Hock pointed to past episodes where USDC lost its peg to the US dollar:
- March 2024: The token’s price briefly plummeted to $0.74.
- 2023: The coin lost about 13% of its value, dropping to $0.87.
“Such drawdowns are completely unacceptable for corporate treasuries and large asset managers. Businesses utilize these tokens as quasi-cash for short-term settlements, and they expect absolute stability, not a roller-coaster ride,” Christoph Hock emphasized.
Tether’s Reserves: Gold, Bitcoin, and High Volatility
The expert paid special attention to Tether. The issuer’s strategy to diversify its reserves with gold and Bitcoin effectively turns the project into a “hidden hedge fund.”
Tether entered early 2026 with the following financial metrics:
| Metric | Data (As of Early 2026) |
| Gold Reserves | 148 tons (approx. $23 billion) |
| Global Ranking | Top 30 largest gold holders worldwide |
| Net Profit (Q1) | $1.04 billion |
Despite impressive profitability (with net profit for the first quarter reaching $1.04 billion), backing the stablecoin with precious metals and cryptocurrency exposes it to market price fluctuations, which is unacceptable for a conservative settlement tool.
Circle’s Strategy: Betting on New Ecosystems
While Tether accumulates gold, its main competitor, Circle, is expanding its investment footprint. The company recently announced the launch of a new token called ARC.
The project has already garnered significant interest from institutional investors. Through its pre-sale, Circle successfully raised $222 million. The funding round backed by heavyweights includes:
- a16z crypto
- BlackRock
- Apollo Funds
Nevertheless, the launch of new tokens and the complex investment maneuvers of issuers only reinforce the experts’ thesis: the stablecoin industry is moving further away from the concept of a “simple digital dollar” toward complex and potentially risky financial structures.
