Tether estimates first-quarter 2023 earnings at $700 million
USDT Stablecoin issuer Tether has estimated its expected first quarter 2023 earnings at $700 million
If this estimate is confirmed, the assets of the issuer of the largest USDT stablecoin by capitalization could exceed its liabilities by $1.6 billion
Tether tentatively estimates first-quarter 2023 earnings at $700 million, CNBC writes. That brings the company's total excess reserves to more than $1.6 billion, Tether CTO Paolo Ardoino told the publication.
Tether issues USDT stablecoin, the exchange rate of which is pegged to the U.S. dollar. USDT reserves are held in fiat currencies and U.S. Treasury bonds. Previously, the token's collateral included commercial paper, but in October 2022, the company reported that it had removed it entirely from USDT's collateral.
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Tether generates revenue from fees, investments in digital tokens and precious metals, and loans to other institutions.
In February, Tether reported a $700 million profit in the fourth quarter of 2022. The company's total assets, after deducting liabilities, were $960.6 million at the time.
If this year's first-quarter earnings estimate holds true, the company's excess reserves would reach $1.66 billion. According to Ardoino, that money will remain in Tether to further capitalize the stablcoin.
USDT is the largest stablecoin by capitalization, ranking third among all cryptocurrencies by this indicator after bitcoin and Ethereum. As of March 24, the capitalization of the asset is $78.8 million. Since the beginning of March, it has grown by more than $7 billion - from $71.7 billion.
The Tether token's capitalization growth comes amid problems for its biggest competitor, Circle's stablecoin USDC. The firm faced a significant outflow of funds from its asset following the collapse of Silicon Valley Bank (SVB), where it held some reserves. Since March 10, USDC's capitalization has fallen by $9.2 billion, from $43.7 billion to $34.5 billion.
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