In a move that illustrates the continuing maturity of the cryptocurrency market, Tether, the prominent issuer of the widely utilized USDT stablecoin, recently revealed its audit statement for the first quarter of the year 2024. Accompanying the audit, an independent report carried out by the accounting firm BDO, which provides a broader financial perspective beyond the cash reserves that shore up Tether’s fiat-denominated stablecoins.
The report unveils a notable capital infusion into the market and reflects the heightened profitability achieved by Tether in the first segment of the year. A thorough dive into the details reveals a net profit of $4.52 billion, signaling the mushrooming growth of Tether’s monetary assets.
⭐ Follow us on Google News! ✔️ This significant profitability is largely credited to the entities in charge of issuing stablecoins and managing reserves. An approximate $1 billion of the windfall has been secured from net operating gains, predominantly accrued from holdings in US Treasury. The drink is topped off with the remaining profits, which are largely attributable to mark-to-market gains on Bitcoin and gold positions.
In a remarkable testament to Tether’s growth trajectory, the report underscores the company’s success in escalating its holdings, directly and indirectly, of US Treasuries, which now total over $90 billion. This tally includes indirect exposure attained through overnight reverse repurchase agreements, which are collateralized by US Treasuries, as well as investments in US Treasuries via money market funds.
Displaying an explicit sign of substantial growth, Tether for the first time disclosed its net equity, which stood at a healthy figure of $11.37 billion as of the close of the first quarter, March 31, 2024. This figure represents an increase, rising from the previously reported equity of $7.01 billion as of December 31, 2023. The report also brought to light a $1 billion rise in excess reserves, thereby fortifying the company’s stablecoin offerings, and pushing the sum total to an impressive figure of nearly $6.3 billion.
Reinforcing the importance of transparency and financial stability, the BDO confirmation affirms that the tokens issued by Tether have a backing of 90% in cash and cash equivalents. This highlights the firm’s philosophy of preserving liquidity in the stablecoin ecosystem. In addition, the report intimates that over $12.5 billion worth of USDT was issued in just the first quarter.
Tether’s strategic investments, which went beyond $5 billion at the time of the report, encompass a range of sectors. These sectors are not confined to technology, represented by the artificial intelligence and data industries, but also extend to the renewable energy sector, person-to-person communication, and Bitcoin mining.
Voicing the company’s perspective on the latest developments, Paolo Ardoino, the CEO of Tether, articulated the company’s unwavering commitment to transparent and stable operations, maintaining liquidity, and managing risks responsibly.
Ardoino drew attention to Tether’s ground-breaking profit benchmark of $4.52 billion and the consistent efforts the company has undertaken to enhance transparency and trust within the cryptocurrency industry. Notably, Ardoino underscored the company’s commitment to raising the bar for the entire cryptocurrency industry with respect to transparency and trust, as evidenced by the disclosure of the group’s net equity of $11.37 billion.