Tether’s Remarkable Progress in US Debt Holdings
In an impressive leap, Tether, a leading stablecoin issuer, has made its mark as a significant holder of US government debt. Now ranked as the 19th-largest owner, Tether’s involvement in Treasuries surpasses that of many prominent countries.
Tether Outpaces Germany in Treasury Investments
According to Tether’s Q1 2025 attestation report, the company holds an impressive $120 billion in US Treasuries, surpassing Germany’s $111.4 billion. This notable shift underscores Tether’s strategic use of traditional bonds to back its digital currency endeavors, positioning it ahead of major sovereign investors.
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An Expanding Role in the US Debt Market
Reports from the US Department of the Treasury reveal that by 2024, Tether had become the seventh-largest purchaser of US Treasuries, outpacing countries like Canada, Mexico, Taiwan, and Norway. The preference for short-term securities highlights a trend among stablecoin issuers to secure dollar-pegged tokens with reliable assets.
Substantial Returns in Q1 2025
In the first quarter of 2025, Tether reported over $1 billion in profits from its conventional investment portfolio, primarily driven by its Treasury holdings. Additionally, Tether’s gold investments helped mitigate volatility in the cryptocurrency market, demonstrating the value of stable, liquid assets in times of market turbulence. These financial maneuvers depend on maintaining low borrowing costs and avoiding large-scale withdrawals.
Unprecedented Growth and Adoption of USDT
USDT, Tether’s flagship stablecoin, achieved a market capitalization exceeding $150 billion for the first time. This milestone represents an increase of more than $11 billion within a year. Over the past 12 months, over 250 million users executed 5.8 billion stablecoin transactions, totaling $33.6 trillion in value.
Visa reports indicate that 192.2 million addresses purchased stablecoins, while 242.7 million received them. With forecasts from Citi and Standard Chartered predicting the stablecoin market could reach $1.6 trillion by 2030 and $2 trillion by 2028, respectively, the growth potential remains substantial.
In a strategic move, Tether listed Tether Gold (XAUₜ) on Maxbit, a Thai exchange, following Thailand’s decision to permit USD-backed stablecoin trading without additional restrictions. This expansion facilitates the free flow of tokenized gold and USDT across Asia’s developing markets.
Tether’s ascent into the top 20 of US debt holders signifies a broader trend of stablecoin issuers increasingly investing in Treasuries. This involvement serves as a critical source of dollar liquidity, adding stability to the often-volatile cryptocurrency market. However, it also places private entities at the forefront of one of the world’s largest financial arenas.
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