Tether Reports $4.9 Billion Profit in Q2
Tether reported a second-quarter profit of $4.9 billion on Thursday, as CEO Paolo Ardoino teased a new, U.S.-specific venture for the stablecoin giant on social media.
Focus on U.S. Markets
In the coming months, the El Salavador-based firm will focus on a business that can build a “best-in-class product suite,” which specifically caters to U.S. markets, he said on X.
Business Growth
In an attestation on Thursday, Tether said its business has generated $5.7 billion in the first six months of this year, a 9.6% increase compared to the same period last year.
U.S. Treasuries Exposure
With $127 billion in exposure to U.S. Treasuries, the stablecoin issuer described itself as one of the largest holders of U.S. debt. For reference, Saudi Arabia held the same dollar-value amount of Treasury securities in May, according to U.S. Treasury Department data.
GENIUS Act and Tether’s Compliance
The company’s latest attestation follows closely after the passage of the GENIUS Act, a landmark piece of crypto legislation in the U.S. that provides a pathway to legality for firms issuing dollar-pegged tokens like Tether and its publicly traded rival Circle.
Backing and Reserves
In a document published on Thursday, accounting network BDO said Tether’s backing includes $8.9 billion worth of Bitcoin and $8.7 billion worth of precious metals. Tether’s stablecoin is mostly backed by $105 billion in U.S. Treasuries, accounting for 64% of its total reserves.
Market Compliance Questions
There have been questions over how Tether will comply with U.S. rules. In February, JPMorgan analysts posited that Tether may be forced to sell Bitcoin to meet the framework’s requirements for reserves. At the time, Ardoino called the analysts “salty.”
Innovation and Monetary Goals
“Tether’s reserves composition exemplifies how private innovation can align with public monetary goals, serving as a conduit for secure, onchain access to U.S. dollar liquidity at scale,” the company said in its attestation on Thursday.
Market Capitalization Comparison
On Thursday, Tether’s market capitalization stood around $163 billion towering over Circle’s $64 billion stablecoin, according to crypto data provider CoinGecko.
Investments in Other Companies
With its excess cash, Tether said it has been ramping up investments in companies like Twenty One Capital, a Bitcoin treasury firm, and Rumble, an online video-sharing platform. The company has also poured funds into Adecoagro, an agricultural firm focused on South America.
Treasury Firm Growth
Earlier this week, Twenty One said that it had received 5,800 Bitcoin from Tether. With 43,500 Bitcoin worth $5.2 billion, it has become the world’s third largest Bitcoin treasury firm since it began accumulating the asset in May, according to Bitcoin Treasuries.