Tether Reports $2.5B Profit in Q3, Holds Over $100B of U.S. Treasuries

Stablecoin issuer Tether Thursday reported $2.5 billion of group-wide net profits in the third quarter of the year, bringing year-to-date profit to $7.7 billion as the market capitalization of its flagship cryptocurrency USDT$1.0001 neared $120 billion.

Some $1.3 billion of the profits derived from yield on U.S. Treasury holdings, while another $1.1 billion was thanks to the unrealized appreciation of the company's gold holdings in the reserve, Tether CEO Paolo Ardoino said in an X post. The price of gold was higher by about 15% during the third quarter.

According to the latest quarterly attestation signed by accounting firm BDO Italy, the company's stablecoin issuer arm Tether International Limited and Tether Limited disclosed $125.5 billion of assets in reserve against $119.4 billion in liabilities as of September 30. Excess reserves backing Tether's stablecoins rose to over $6 billion.

Some $105 billion of the reserve assets were held in cash and cash equivalents, including $84.5 billion in U.S. Treasury bills, per the attestation. The company's direct and indirect exposure to T-bills, which includes holdings in money market funds and reverse repurchase agreements, surpassed $102 billion. It also held $5 billion worth of gold and $4.8 billion in bitcoin BTC$90,313.03 among reserve assets.

Tether Investments, the group's venture arm that manages Tether's growing foray into energy, mining and artificial intelligence, had a net equity value of $7.7 billion, up from $6.2 billion in the previous quarter. It also disclosed owning 7,100 bitcoin BTC$90,313.03 worth nearly $500 million, the company said in a blog post.

Tether's USDT is a crucial part of the digital asset ecosystem, being the third largest cryptocurrency by market cap and serving as the main form of liquidity on exchanges and increasingly as a payment method in emerging markets.

A Wall Street Journal report last week alleged Tether is under U.S. criminal investigation for possible violations of sanctions and anti-money-laundering laws, which the company denied. Paolo Ardoino, CEO of Tether, said in an interview with CoinDesk that the company respects U.S. sanctions and is dedicated to remaining a large buyer of U.S. debt.