S&P Downgrades Tether’s USDT Citing Bitcoin Price Exposure
S&P Global Ratings has downgraded Tether’s USDT rating, according to the agency, citing a growing portion of reserves tied to Bitcoin and the attendant volatility risk that could undermine USDT’s ability to maintain a stable peg. S&P said the shift toward crypto assets in reserves increases the likelihood of valuation swings and potential liquidity strain if Bitcoin prices move sharply. The downgrade matters because USDT is a major on‑ramp for crypto markets; any perceived weakening of its backing can ripple through exchanges, P2P platforms, and lending products that use USDT as collateral. Traders and stablecoin users should watch liquidity metrics and spreads, while market participants and regulators may press for clearer reserve composition and contingency plans from Tether.