In the first half of 2024, Tether achieved an impressive $5.2 billion profit, predominantly through interest income on reserve assets such as US Treasuries. By mid-2024, Tether held approximately $97.6 billion in government debt, positioning itself as a key player in the financial markets. Users deposit fiat currency to mint USDT, and Tether invests these dollars in yield-generating assets. Tether's diverse investments include not only Treasurys but also gold and cryptocurrency, which contribute to its revenue. Additionally, Tether generates income from transaction fees and collateralized loans, elevating its profit margins. High interest rates and the scale of Tether’s reserves were crucial in boosting profits in 2024, as even small interest rate changes significantly impacted revenues. However, Tether faces regulatory scrutiny concerning its reserve practices, and potential risks include interest rate fluctuations and asset concentration. Compared to competitors like Circle, Tether's profitability model relies heavily on its ability to manage larger reserves and generate income with fewer constraints.

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