Tether has 65% of its total supply

The backers of Tether, the biggest stable coin, haven't been enough toreassure markets that the token is backed by ample reserves and working smoothly.

The token has 65% of the total as of Friday, with the liquidity pool that allows traders to swap between the three biggest stablecoins still showing an elevated supply of Tether. Edul Patel, chief executive of Mudrex, said investors are cautious about holding Tether.

Since the collapse of the TerraUSD stablecoin in early May, the scrutiny of the assets it claims to be backed by has led to increased scrutiny of the assets it claims to be backed by. The Wall Street Journal reported on Monday that short sellers have boosted bets against Tether in the past month, as well as Leon Marshall, Genesis Global Trading Inc.'s head of institutional sales.

Since TerraUSD's implosion last week, the market value of the ether dropped by about 600 million dollars, bringing declines of around $17 billion, according to CoinGecko data.

A Tether spokeswoman said that USDT is the most widely held and most accessible stable coin in the world, so it isn't surprising that more people hold USDT and have it available to swap for other assets that they want to use for other purposes. The USDT is the ticker for Tether's main dollar-based stable coin.

On Curve's 3 pool where traders can swap between Tether, USDC and DAI, Tether's share of supply stood at 29.9% on May 6, just before TerraUSD started deviating from its peg. On May 12th, that portion went up as high as 82% as the TerraUSD crisis worsened, knocking Tether from its own peg.

Tether's share of supply has declined, but it remains above pre-TerraUSD crisis levels. It reversed some of the decrease after the Journal report.

The 3 pool platform handled about $117 million in trading volume on Friday.

Since the May decoupling, Tether has hewed close to its dollar peg and continues to be widely used despite all the questions surrounding it. Over the weekend, the cost of buying the token with Argentine pes surged after the nation's Economy Minister Martin Guzman resigned.

Tether relies on a reserve of dollars and dollar-equivalent assets to keep its one-to-one peg with the currency, though the quality of this stockpile has been called into question repeatedly.

Tether files quarterly attestations from a Cayman Islands accounting firm about its holdings, which shows that it has been steadily decreasing its exposure to assets like commercial paper in favor of more liquid instruments like Treasury bills.

In February, Bloomberg reported that Fir Tree Capital Management was making a significant short bet on Tether, which could pay off within a year.

Read more: Shorting Tether Renews Debate Around Most Traded Cryptocurrencies

Tether Chief Technology Officer Paolo Ardoino has taken to Twitter to reassure markets since TerraUSD cratered. In a 12 part tweet this week, he said Tether never failed a redemption and that it has cut its commercial paper holdings by around $45 billion, adding that the portfolio of Tether is stronger than ever. Generations of Black Americans lost their land to tax liens because of their race to the U.S.