Key Points
- Tether reported a net profit of $13 billion in 2024, largely driven by its USDT issuance business.
- The company faced regulatory challenges in European markets, leading to a decline in confidence among exchanges.
Tether, the company behind the largest cryptocurrency stablecoin USDT, posted a net profit of $13 billion in 2024. The profit was largely driven by its various businesses, including the issuance of USDT.
The company’s profits soared amid a surge in digital asset adoption and a record high in U.S. Treasury Bills held as reserves for its token.
Financial Details
On January 31, Tether’s quarterly attestation revealed that the company held $94.5 billion worth of T-Bills, a new record. The attestation, provided by independent accounting firm BDO Italia, also showed that Tether generated $7 billion in profits from its U.S. Treasury holdings and an additional $5 billion in unrealized earnings from Bitcoin (BTC) and gold investments.
Towards the end of 2024, Tether increased its Bitcoin holdings to approximately 84,000 Bitcoin, valued at nearly $8 billion. This marked the company’s first Bitcoin purchase since March of that year. The remaining $1 billion in profits was generated from other investments.
Market Position and Challenges
Tether operates USDT, the leading stablecoin with a market capitalization of $140 billion. This makes the company a significant player in cryptocurrency transactions. A study by the U.S. Treasury revealed that over 80% of cryptocurrency transactions involve a stablecoin such as USDT.
Despite its importance, Tether and USDT have faced difficulties in European markets due to regulatory changes. Tether has had trouble complying with the European Union’s Markets in Crypto Assets Regulation framework, resulting in a decline in confidence among exchanges.
Several platforms, including Coinbase, have removed USDT for European users until changes in compliance are made.
Tether has relocated its operations to El Salvador after obtaining a cryptocurrency license from the pro-Bitcoin country. The company plans to set up a headquarters in El Salvador and invest more resources in artificial intelligence.