Tether’s Operational Profit Was Over $1B in 2023 Q2: Report
Tether published its latest Consolidated Reserves Report (CRR), which breaks down the company’s total assets and profits it held in Q2 2023. According to the report, Tether’s operational profits stood at more than $1 billion in the quarter, 30% higher than in the previous period.
Tether Excess Reserves Increased by $850M in Q2
According to its latest attestation report, Tether, the company behind the world’s largest stablecoin USDT, said its excess reserves in Q2 2023 increased by $850 million. The surge, notably lower than the $1.5 billion reported in the previous period, takes Tether’s total excess reserves to around $3.3 billion.
Excess reserves refer to the company’s profits not distributed to shareholders. Tether holds these funds on top of the 100% reserves it maintains to back all outstanding USDT tokens. Earlier this year, Tether said it plans to allocate 15% of its profits to buy Bitcoin to diversify its USDT reserves.
Tether also reported operational profits of more than $1 billion in the quarter that ended in June, representing a quarter-on-quarter increase of 30%. The share buyback amount stood at $115 million in Q2, in addition to Tether’s energy-related investments not included in the report.
Tether said that total consolidated assets were reported at around $86.5 billion as of June 30, while consolidated total liabilities amounted to $83 billion. Meanwhile, the company’s reserves “remain extremely liquid, with 85% of its investments held in cash and cash equivalents.”
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“Transparency is not just a buzzword,” says Tether CTO
Tether’s latest attestation report demonstrates the significance of adopting appropriate risk management measures, the stablecoin issuer said, citing recent challenges in the banking and crypto industries.
USDT remains by far the biggest crypto stablecoin, with a market cap of nearly $84 billion, compared to runners-up USDC and DAI, which have market caps of $26.5 and $4.5 billion, respectively.
“Transparency is not just a buzzword for us; it is the cornerstone of our philosophy. We believe that open communication and strong financials foster trust and reliability, and this is what the global community deserves especially in a year devastated by many failures across the banking and crypto industry.”– said Tether’s CTO, Paolo Ardoino.
USDT has previously been a subject of controversy, with some raising liquidity concerns around the stablecoin and its issuers’ ability to cover the number of USDT tokens in circulation. However, those allegations are yet to materialize as USDT is yet to break its peg to the US dollar, in contrast to some of its peers.
Why do you think Tether has been consistently criticized even though it has successfully weathered all periods of crypto market turmoil? Let us know in the comments below.