Tether Holdings, the issuer of the world’s largest stablecoin, Tether (USDT), has announced a record net profit of $4.52 billion in the first quarter of 2024. This marks a significant achievement for the company and demonstrates its financial strength and stability.
The substantial profit was mainly attributed to the firm’s financial gains on Bitcoin and gold, totaling $3.52 billion, and an additional $1 billion from operating profits. Tether’s net equity, which was disclosed for the first time, stood at an impressive $11.37 billion as of March 31. This is a substantial increase from the previous record of $7.01 billion at the end of December 2023.
The company’s CEO, Paolo Ardoino, emphasized Tether’s commitment to transparency, stability, liquidity, and responsible risk management. Tether’s attestation report for Q1 2024 provided a comprehensive overview of the company’s financial strength, revealing its success in increasing ownership of US Treasuries, now exceeding $90 billion.
Tether’s fiat-denominated stablecoins are backed by cash and cash equivalents at 90%, ensuring liquidity within the stablecoin ecosystem. The report also highlighted strategic investments of over $5 billion in sectors such as AI, renewable energy, and BTC mining.
Despite concerns about the lack of a formal audit, Tether’s quarterly attestation reports offer insights into the company’s balance sheet, attested to by BDO, the fifth-largest accounting network globally. Tether’s decision to invest part of its operating profits in Bitcoin has proven lucrative, with the company’s Bitcoin holdings reaching 75,300 BTC, valued at over $4.38 billion.
While Circle’s USDC recently surpassed Tether’s USDT in transaction volume, Tether remains dominant in the stablecoin market, commanding over 68% of the market with a market cap exceeding $100 billion. Analysts attribute USDC’s rise to its predominant use within the US for transactions, contrasting with USDT’s role primarily as a dollar-based store of value held outside the US.
Tether has also made a significant investment of $200 million in Blackrock Neurotech, marking its first move into the healthcare industry. Despite recent market volatility, Tether maintains a strong financial position with excess reserves totaling $6.3 billion, providing a buffer against potential risks.
Overall, Tether’s record net profit in Q1 2024 highlights its financial strength and stability in the cryptocurrency industry. The company remains committed to transparency, responsible risk management, and driving innovation in the stablecoin market.