Tether Now Holds More U.S. Treasuries Than Australia, UAE, and Spain

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Tether, the world’s largest stablecoin, continues its skyward ascent, reporting an impressive Q2 2023. Assets soared by 5.7% to a record-breaking $86.5 billion, and operational profits surged by 30% to over $1 billion from the previous quarter.

Treasury Triumphs and a Bitcoin Bonanza

Significantly contributing to Tether’s financial muscle is its strategic investment in U.S. Treasury Bills, now totaling $55.8 billion, outpacing even Spain’s holdings. Notably, this figure surpasses the U.S. treasury holdings of Australia, UAE, and even Spain. According to crypto analyst Miles Deutscher, Tether’s impressive operational profits rival those of BlackRock, the world’s largest asset manager.

The company’s Q2 also saw a notable increase in its Bitcoin reserve, with an additional purchase of 2,310 Bitcoins amounting to $70 million. This move has seen Tether’s Bitcoin stacks climb from 52,698 in Q1 to 55,008 in Q2, now valued at $1.67 billion.

However, despite its announcement earlier this year to invest 15% of profits in Bitcoin, data indicates that the company has only allocated 7% so far.

Excess Reserves: Tether’s Financial Buffer

Tether is demonstrating remarkable financial resilience with its excess reserves, totalling $3.3 billion at the end of Q2. This decision to hold back a significant portion of its profits, over and above the 100% reserve necessary to back its issued tokens, adds a layer of security and resilience to its stablecoin products.

Paolo Ardoino, CTO of Tether, revealed the company’s investments in energy-related initiatives funded from Q2 profits, a move seen as a key step in pushing the boundaries of technological innovation. These investments are not included in the Consolidated Reserves Report as they are not considered as eligible reserves for circulating tokens.