Key Highlights
- Tether trims fundraising plans after investor pushback, now eyeing $5 billion instead of a $500 billion valuation.
- USDT stays dominant with $187 billion circulating, while Tether projects 2026 profits above $10 billion.
- Tether diversifies reserves with Treasuries, Bitcoin, and gold, but S&P flags rising risk exposure.
Tether, the issuer of the world’s largest stablecoin USDT, has scaled back its fundraising plans following pushback from investors over a previously discussed $500 billion valuation. The El Salvador-based firm had initially explored raising $15 billion to $20 billion for a 3% stake, potentially valuing the company at half a trillion dollars.
The firm’s CEO Paolo Ardoino told the Financial Times that the previously disclosed figure was a “misconception” and clarified that, “number is not our goal. It’s our maximum we were ready to sell.” Advisers are now exploring smaller raises, possibly as low as $5 billion, reflecting caution from investors reluctant to buy in at such lofty valuations.
The early talks at Tether aimed for a $500 billion valuation, but insiders called off to sell their shares and investors were also hesitant for such a larger raise. This led the company to rethink its fundraising plans.
Ardoino also pointed out Tether’s growth trajectory, stating that profits in 2026 are expected to be higher than those made in 2025, which were over $10 billion. The number could be even higher than those made in 2024, which were over $13 billion.
Fundraising adjustments and investor dynamics
Tether has been moving to solidify its dominant position in the stablecoin market. Its USDT stablecoin remains the most dominant digital dollar in circulation within the crypto markets, with a circulating supply of nearly 186 billion.
The company is now focusing on bringing in strategic investors and has talked with financial giants like SoftBank and Ark Investment Management. Tether also stopped shareholders from selling their stakes on the open market to protect the fundraising process.
A spokesperson cited by Bloomberg reportedly said, “It would be imprudent, and indeed reckless, for any investor to attempt to circumvent the established process.” Hence, management seeks controlled capital inflows rather than uncontrolled stake sales.
Tether is also looking at ways in which investors can access their money after the fundraising process is over. This could be done through the repurchase of shares or the conversion of shares into digital tokens and recording them on a blockchain. This ensures that the confidence in Tether’s long-term plans is not undermined, and the shares are not sold off at a low price. In fact, one shareholder was reportedly looking to sell $1 billion worth of shares at a discount.
Reserve management and market position
The firm is spreading out its assets to keep its money safe while still earning returns. By 2025, it held a record $141.6 billion in U.S. Treasury bonds, including some short-term investments. It also owns $8.4 billion in Bitcoin and $17.4 billion in gold, buying over $1 billion of gold each month. These steps help keep the USDT stablecoin reliable and reduce risks in the digital dollar market.
However, S&P Global Ratings lowered USDT’s stability score from 4 (“constrained”) to 5 (“weak”) because Tether is holding more risky assets, rising from 17% in 2024 to 24% in 2025. Bitcoin alone makes up 5.6% of its reserves, well above the 3.9% safety buffer.
S&P warned that if these assets lose value quickly, USDT could fall short, and they also pointed out gaps in Tether’s reporting and risk management.
Tether is scaling back its fundraising plans because investors are wary of its high valuation. Still, its USDT stablecoin remains the most widely used, controlling more than 60% of the market as per DefiLlama data.
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