Tether earns $1B in Q1 profit, holds $5.6B in excess reserves

Tether, the company behind the world’s largest stablecoin by market capitalization, disclosed in its 2025 first-quarter report that it posted an operating profit of more than $1 billion and holds nearly $120 billion in U.S. government securities.

The company’s Q1 2025 financials show that it holds $98.5 billion in U.S. Treasury bills and maintains further exposure exceeding $23 billion through repos and similar cash-equivalent assets.

According to Tether, it currently holds $5.6 billion in excess reserves for its USDt stablecoin—down from $7.1 billion in Q4 2024.

On May 1, the market valued the stablecoin at $149 billion in terms of market cap.

“Circulating supply of USDT grew by approximately $7 billion in Q1, with a 46 million increase in user wallets,” it said.

The company continues to deploy its excess capital into targeted investments, investing over $2 billion in renewable energy, artificial intelligence, data infrastructure, and peer-to-peer technologies.

In Q1 2025, Tether began operating under formal regulatory oversight for the first time in El Salvador. As a licensed stablecoin issuer under the Digital Assets framework in El Salvador, the company is improving its standing in both the emerging and traditional financial markets.

Paolo Ardoino, CEO of Tether, said that “Q1 2025 showcases Tether’s continued leadership in stability, strength, and vision.”

The stablecoin sector is overwhelmingly led by U.S. dollar-linked tokens, with USDT and USDC holding 87% of the market.

The U.S. Treasury noted in its Q1 2025 report that dollar-denominated stablecoins are on track to achieve a $2 trillion market cap by 2028.

European Union authorities have voiced concerns regarding the risks tied to an overdependence on U.S. dollar-pegged stablecoins.

In a recent statement, the Bank of Italy warned that any disruptions in the stablecoin market or the bonds linked to it could have significant consequences for the global financial system.

Crypto, once focused on disrupting the banking sector, now finds itself playing a similar role in the contest over stablecoins.