Tether CEO Calls Paraguay’s Rising USDT Demand a Flight to Safety Amid Banking Crisis

Tether CEO Paolo Ardoino has described rising USDT demand in Paraguay as a “flight to safety” amid growing banking concerns. According to Bitcoin advocate Samson Mow, USDT gained over 5% against Paraguay’s guaraní between October 15 and November 4 amid Ueno Bank’s financial troubles.

Tether CEO Reacts as USDT Gains Against Paraguayan Guaraní

In a recent X post, Mow highlighted USDT’s increasing exchange rate as Paraguay struggled with uncertainty surrounding Ueno Bank. Mow linked USDT’s rise from 5,692 guaraníes on October 15 to over 6,000 by November 4 to growing demand for banking alternatives.

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Responding to the development, Ardoino characterized the reported movement toward USDT as a “flight to safety.” The remarks reflected Tether’s interpretation of rising stablecoin demand during Paraguay’s banking difficulties. Meanwhile, the U.S. dollar also strengthened against the guaraní, suggesting broader currency movements contributed to USDT’s increase.

Paraguay Banking Crisis Raises Concerns Over Depositor Funds

Paraguay’s central bank announced resolution proceedings against Ueno Bank on November 3 following serious concerns about its financial condition. Regulators discovered that the institution’s solvency ratio had fallen below half the required minimum.

Ueno Bank reportedly serves approximately three million customers, making the disruption significant for Paraguay’s financial sector. Additionally, concerns emerged over public funds deposited with the institution, including substantial resources belonging to Paraguay’s social security system.

Reports indicated that authorities arrested eight individuals connected to the institution, while central bank president Carlos Carvallo resigned. Despite the disruption, regulators maintained that Ueno Bank’s difficulties did not indicate a nationwide banking collapse.

USDT Demand Reflects Growing Interest in Dollar-Based Alternatives

The banking crisis has increased interest in dollar-denominated alternatives as depositors assess ways to protect their savings. Mow’s observations highlighted USDT’s growing exchange rate, while Ardoino linked the development to demand for financial security.

Nevertheless, customers with frozen deposits cannot necessarily purchase stablecoins until authorities restore access to their funds. The situation highlights USDT’s potential appeal during banking disruptions, although the reported price increase does not establish actual purchase volumes.