Tether Posts Massive First Quarter Profits of $1.48 Billion

Tether today reported a net profit of $1.48 billion, with the company behind the world’s biggest stablecoin saying it was “very optimistic for the future.” 

In a Wednesday blog post, the sometimes controversial company summed up its 2023 Q1 assurance report—prepared by accounting firm BDO Italia—by revealing that its reserves reached an all-time high of $2.44 billion, a $1.48 billion increase over the same quarter last year. 

The company also said that most of its reserves were held in cash and cash equivalents, with the majority “invested in U.S. Treasury Bills.” Only 1.8% was held in Bitcoin. 

Although BDO Italia was commissioned to prepare the report, it has yet to be independently audited. 

Tether CTO Paolo Ardoino said in a statement: “We are thrilled with the tremendous success Tether has achieved in Q1 2023, with our reserves’ surplus reaching an all-time high of $2.44B.”

Tether works to mint USDT—the third-largest cryptocurrency after Bitcoin and Ethereum and the biggest stablecoin. Stablecoins are cryptocurrencies backed by “stable” assets, like the U.S. dollar. 

USDT has a market cap of $82.5 billion and is the most traded cryptocurrency, with a 24-hour trading volume of $16.5 billion. Traders use it to enter quickly and exit trades without using a traditional bank or fiat currency. 

This is particularly popular in markets where dollars are restricted or unavailable, as well as in DeFi, which seeks to disintermediate banks.

Tether has courted controversy for what some feel is inadequate transparency into whether U.S. dollars indeed back USDT. 

In March, the Wall Street Journal cited emails reporting that companies backing USDT used fake documents and shell companies to help its parent company get into the banking system. Tether said the WSJ report was “wholly inaccurate and misleading.”

And back in 2021, Tether agreed to no longer do business in New York after a two-year New York Attorney General investigation found it had “made false statements about the backing” of its stablecoin.