Tether Holdings, the company behind the popular stablecoin Tether (USDT), has announced a remarkable net profit of $4.52 billion in the first quarter of 2024, setting a new record for the company. The impressive profit was mainly due to the financial gains made from Bitcoin and gold, amounting to $3.52 billion, as well as an additional $1 billion from operational profits.
This significant increase in net equity is a notable achievement for Tether, with the company’s equity reaching an impressive $11.37 billion as of March 31. This is a substantial increase from the previous record of $7.01 billion at the end of the previous quarter in December 2023.
Tether CEO Paolo Ardoino emphasized the company’s commitment to transparency, stability, liquidity, and responsible risk management. The attestation report for Q1 2024 provided an in-depth overview of Tether Group’s financial strength, highlighting its success in acquiring over $90 billion worth of US Treasuries. Additionally, Tether’s fiat-backed stablecoins are backed by 90% cash and cash equivalents, ensuring liquidity within the stablecoin ecosystem. The report also revealed strategic investments of over $5 billion in sectors such as AI, renewable energy, and BTC mining.
While Tether has faced criticism for the lack of a formal audit, its quarterly attestation reports provide valuable insights into the company’s balance sheet, attested by BDO, one of the world’s largest accounting networks.
Tether’s decision to invest a portion of its profits in Bitcoin has proven to be lucrative, with the company now holding 75,300 BTC, valued at over $4.38 billion. This diversification strategy has contributed to Tether’s continued success despite market volatility. The company also maintains excess reserves of $6.3 billion, providing a buffer against potential risks.
“Tether once again demonstrates its commitment to transparency, openness, and conservative risk management, maintaining a large amount in excess reserves and providing disclosures for the Group,” wrote Tether CEO Paolo Ardoino.
While Circle’s USDC has recently surpassed Tether’s USDT in transaction volume, with USDC recording $456 billion compared to USDT’s $89 billion, Tether remains dominant in the stablecoin market. It commands over 68% of the market with a market cap exceeding $100 billion. Analysts attribute USDC’s rise to its predominant use within the US for transactions, while USDT is primarily used as a dollar-based store of value held outside the US.
In a recent move, Tether has ventured into the healthcare sector with a substantial $200 million investment in Blackrock Neurotech, a leading biotech company specializing in brain-computer interface (BCI) technology. This marks Tether’s first entry into the healthcare industry.
Despite Bitcoin’s recent drop below the $60,000 mark, Tether remains strong with an unrealized profit of over 91% and a value of over $2 billion, according to CoinStats.
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