Tether Comeback? Stablecoin Innovator Touts $83B Market Cap, 'Financial Freedom'

Tether has surpassed its previous all-time high market cap of $83.2 billion — a value it lost during the 2022 cryptocurrency crash.

"Today's numbers demonstrate that people want access to financial freedom, and when given that access, they will make use of it," Tether CTO Paolo Ardoino said, expressing confidence in the significance of this milestone.

"Tether tokens offer a safe harbor for the unbanked and allow people in emerging markets to keep their buying power, even when their national currency is being devalued. We are eager to continue expanding access to financial freedom globally," he added.

In the first quarter of 2023, the company — known for its stablecoin USDT/USD — reported a net profit of $1.48 billion and has significantly strengthened its reserves.

Tether maintains approximately 85% of its investments in cash, cash equivalents, and other short-term deposits, along with a 20% increase in token supply quarter over quarter and substantial excess reserves of around 2.5 billion USDT.

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The stablecoin’s circulation dropped about 20% in the second quarter of last year as Terra’s collapse destabilized crypto markets, kickstarting a period filled with bankruptcies, high-profile scandals, and a plunge in most cryptocurrencies’ prices.

The circulation of USDT has grown in recent months even as its main rival, Circle Internet Financial Ltd.’s USDC/USD, has shrunk and crypto trading volumes, on the whole, remained lackluster.

That trend has added to the ambiguity surrounding the dominant stablecoin, according to researcher Kaiko.

USDT is used in more than 50% of all trades on centralized exchanges. Yet, Tether’s market share relative to other stablecoins hasn’t noticeably increased during the downturn in activity.

Shifts in USDT’s use on decentralized exchanges — which let users trade without intermediaries — alone don’t explain the gain, it added.

The company settled with the New York Attorney General in 2021 over an alleged commingling of client and corporate funds and lying about its reserves to investors.

Tether, along with its sister crypto exchange Bitfinex, never admitted any wrongdoing.

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