Tether, the company that makes the dollar-pegged USDT stablecoin, said on July 31 that it had made a record-breaking $5.2 billion in profits in the first half of 2024 and had a record-high hoard of U.S. government bonds.
The amount of Tether’s U.S. Treasury holdings is now about $97.6 billion. The rise in Treasury reserves is similar to the rise in use of Tether stablecoins, which the company says are backed 1:1 with liquid assets denominated in U.S. dollars. An attestation from the independent accounting company BDO backs up these numbers.
Binance says that the total market value of USDT is about $114 billion. This is a little less than the total value of Tether’s assets, which are more than $118 billion.
Tether Surpasses Global Treasury Reserves
The Treasury reserve of the company is now greater than that of all but 17 countries in the world. This includes Germany, the UAE, and Australia. The only countries that buy more 3-month U.S. Treasurys than it are the Cayman Islands and the United Kingdom. The company said, “Given the rate of USDT adoption, (Tether) sees the potential of becoming first in the next year.”
The announcement also said that as of June 30, Tether’s combined net equity was $11.9 billion. This is the sum of all the company’s assets minus all of its debts. In the second quarter, the company gave out about $8.3 billion. USDT is always being given and redeemed.
CEO Paolo Ardoino says that Tether’s balance sheet lets the business “continue leading the stablecoin industry in stability and liquidity” while also growing its knowledge in areas like AI, biotech, and telecommunications.
Some of Tether’s gains have been put back into related fields, such as data, AI infrastructure, neurotech, education, sustainable energy, Bitcoin mining, and P2P telecommunications technology.
People want faster and safer cross-border spending, which is why stablecoins like Tether and its rival US Dollar Coin are becoming very popular very rapidly. In May, the research company Sacra said that stablecoins’ “extreme product-market fit for cross-border money movement” could make them the most popular way to send money across borders, with over $4 trillion in payments made each year.
Along with tokenized real-world assets, crypto is becoming a major reason why people want to buy U.S. Treasurys. Research expert Tom Wan thinks that by the end of 2024, the market for tokenized U.S. Treasury bonds will be worth $3 billion.
