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Tether Holdings, the issuer of the world’s largest stablecoin, Tether (USDT), has reported a record net profit of $4.52 billion in the first quarter of 2024, marking a significant achievement for the company.
According to the report, the substantial profit was primarily attributed to the firm’s financial gains on Bitcoin and gold, totalling $3.52 billion, and an additional $1 billion from operating profits.
A Significant Increase Compared to The Last Quarter
My summary Tether's Q1/2024 attestation. Another great quarter!
As of 31st March 2024:
– $4.52 Billion Profit for Q1/2024. ~1 billion in net operating profits, primarily derived from US T-Bills. The remainder derived from mark-to-market gains in Bitcoin and Gold positions.— Paolo Ardoino 🍐 (@paoloardoino) May 1, 2024
Tether’s net equity, disclosed for the first time, stood at an impressive $11.37 billion as of March 31, a substantial increase from the previous record of $7.01 billion worth of equity at the end of the quarter in December 2023.
CEO Paolo Ardoino emphasized the company’s commitment to transparency, highlighting Tether’s dedication to stability, liquidity, and responsible risk management.
“With the first attestation of 2024, Tether has demonstrated its unwavering commitment to transparency, stability, liquidity, and responsible risk management.”
The attestation report for Q1 2024 provided a comprehensive overview of Tether Group’s financial strength, revealing its success in increasing ownership of US Treasuries, which now exceed $90 billion.
“As shown in this latest report, Tether continues to shatter records with a new profit benchmark of $4.52 billion, reflecting the company’s sheer financial strength and stability. In reporting not just the composition of our reserves, but now the Group’s net equity of $11.37 billion, Tether is again raising the bar in the cryptocurrency industry in the realms of transparency and trust.”
Tether’s fiat-denominated stablecoins were backed by cash and cash equivalents at an impressive 90%, ensuring liquidity within the stablecoin ecosystem. The report also highlighted strategic investments of over $5 billion across various sectors, including AI, renewable energy, and BTC mining.
Despite concerns about the lack of a formal audit, Tether’s quarterly attestation reports offer insights into the company’s balance sheet, attested to by BDO, the fifth-largest accounting network globally.
Tether’s decision to invest part of its operating profits in Bitcoin has proven lucrative. According to on-chain data, the company’s Bitcoin holdings reached 75,300 BTC, valued at over $4.38 billion. The move to diversify its portfolio has contributed to Tether’s continued success despite market volatility.
While Bitcoin’s price has fluctuated since the end of Q1, Tether remains confident in its financial position. Its excess reserves total $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,” Tether CEO Paolo Ardoino wrote on X.
Tether Continues to Lead the Stablecoin Market
Circle’s USDC recently surpassed Tether’s USDT in transaction volume, according to data released by Visa in partnership with Allium Labs. USDC recorded a transaction volume of $456 billion last week, compared to USDT’s $89 billion, indicating a substantial gain in market share.
Despite this achievement, Tether remains dominant, commanding 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, contrasting with USDT’s role primarily as a dollar-based store of value held outside the US.
Tether has also recently ventured into the healthcare sector with a significant $200 million investment in Blackrock Neurotech, a leading biotech company specializing in brain-computer interface (BCI) technology. This investment marks Tether’s first move into the healthcare industry.
According to CoinStats, Tether has an unrealized profit of over 91% and is worth over $2 billion, despite Bitcoin’s recent fall below the $60,000 mark.