In the first half of 2024, Tether reported unprecedented profits of $5.2 billion, mainly driven by interest income on its substantial reserves, particularly US Treasuries. By mid-2024, Tether held $97.6 billion in these government bonds, making it one of the largest holders globally. Users deposit fiat, allowing Tether to mint USDT while investing deposits in yield-generating assets. In addition to Treasuries, Tether's portfolio includes gold, Bitcoin, and secured loans. Its revenue streams also consist of transaction fees, secured lending, and partnerships with fintechs that expand its ecosystem. High interest rates in 2024 amplified Tether's income as it leveraged its scale, allowing small interest rate changes to result in significant profit increases. However, Tether faces risks, including regulatory scrutiny and asset concentration risks, particularly as lower interest rates could impact profitability. Compared to other stablecoin issuers like Circle and Paxos, Tether's operational flexibility and size create a notable advantage in profitability despite ongoing compliance challenges.

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