Tether Profits Over $1 Billion in Q2/2023 Thanks to US Treasury Investments

Tether's latest asset verification report reveals the company has added an additional $850 million to its reserve fund, increasing it to $3.3 billion.

Tether Profits Over $1 Billion in Q2/2023 Thanks to US Treasury Investments. Photo: Bloomberg

According to the latest asset verification report for Q2/2023 released by Tether on the evening of July 31, the leading cryptocurrency stablecoin issuer continues to report staggering operational profits.

Specifically, Tether disclosed profits exceeding $1 billion over the past three months, primarily from holding US Treasury bills (T-bills). The company stated it holds up to $72.5 billion in assets backing USDT in the form of T-bills, making Tether the 23rd largest holder of US government debt globally.

Comparatively, in the previous reporting period, Tether held nearly $69 billion in US Treasury bills, with profits totaling $1.5 billion.

The company plans to allocate $850 million of these profits to bolster its surplus reserve fund, raising its value to $3.3 billion. This reserve serves as Tether's "rainy day fund" but is pledged by the company to back USDT in case of need.

As of June 30, 2023, Tether's balance sheet shows it holds nearly $86.5 billion in assets, with $83.1 billion allocated to secure the issued stablecoin USDT, and the remainder in reserve.

Assets held by Tether as of June 30, 2023. Source: Tether

Other asset classes held by Tether, such as corporate bonds, precious metals (gold), Bitcoin, other investments, and Tether's lending activities, showed minimal fluctuations compared to Q1.

During Q2/2023, the company spent $115 million on share buybacks from investors and undisclosed amounts on investments in crypto mining, as announced in June 2023.

Q2/2023 also marked a period where Tether's market capitalization consistently reached new highs, currently at a record $83.8 billion.

Market capitalization fluctuations of Tether over the past year, screenshot from CoinMarketCap on the evening of July 31, 2023

However, Q2 wasn't all smooth sailing for Tether. In late June, the company faced a new wave of FUD (Fear, Uncertainty, Doubt) when documents from the 2021 lawsuit with the New York State government were released, showing the stablecoin issuer previously held significant commercial paper from Chinese companies. Tether subsequently affirmed it had completely removed Chinese commercial paper from its USDT reserve asset portfolio.