Tether, the largest stablecoin and currently the third-largest cryptocurrency in terms of market cap, reported a net profit of $5.2 billion in the first half of 2024. Interestingly, the financials are largely backed by Tether’s investments in traditional markets, with a particular focus on US Treasuries.
Despite its strong financial performance in H1, Tether’s short-term growth has not kept up with some of its competitors. However, the company’s emphasis on openness and financial stability appears to be paying off.
Tether is largely invested in US T-bills
Tether’s financial report for the first half of 2024 showed a net profit of $5.2 billion, owing to strong income creation from traditional asset investments. In the second quarter, the company’s net operating profit was $1.3 billion, another all-time high for a quarterly figure.
Tether now edges out Germany as one of the largest holders of US Treasuries. pic.twitter.com/Yc95jqHikM
— Zaheer (@SplitCapital) July 31, 2024
Notably, Tether’s portfolio includes a big investment in US Treasuries, which has increased its revenue. Tether had $97.6 billion in T-bills at the end of the second quarter, establishing itself as a large holder of US debt and outpacing some countries like Germany. The financials are good news for Tether when it comes to demonstrating financial stability, profitability, maintaining a big reserve of traditional assets, and transparency.
Tether also reported its highest-ever group consolidated equity, reaching $12 billion as of June 30.
Tether gained in 2024
Another noteworthy factor is that the overall stablecoin market has reportedly grown since the SVB collapse. Tether surpassed the circulating supply of $113 billion in July for the first time since the banking crisis. IntoTheBlock marked it as a milestone since the collapse of Silicon Valley Bank (SVB) in March of the previous year. According to CoinMarketCap, Tether’s supply has now crossed $114.4 billion.
Data from IntoTheBlock shows that the total market cap of stablecoins went up from around $120 billion in August 2023 to over $160 billion by the end of July 2024.
Tether is still the biggest player in the stablecoin market, but it’s not growing as fast as some of its competitors in the short term. Monerium for instance, reported a 57.5% increase in a week. Even Inverse Finance managed to bump up by 5.7%. Despite reporting profits, Tether’s growth hit a standstill in the short term. As per Token Terminal data, its supply stayed put at 0% over the 7 days. This means that Tether kept its stability game strong. But as a dominant player, it’s missing out on the expansion spree seen by some of its rivals.
Fastest growing Stablecoin issuers, based on 7d % growth in outstanding supply: pic.twitter.com/SOogvBEDYd
— Token Terminal (@tokenterminal) July 31, 2024
In other separate but related news, a whale transfer shifted 70 million USDT from Binance to a mystery wallet. Amid Tether’s active market, it has a market liquidity ratio of around 45% over the past 24 hours, according to CoinMarketCap.
This means that Tether’s short-term growth rate may be slower than some competitors. But its financial strategy appears strong on the quarterly numbers. It has record profits, reserves, and traditional investments to re-position itself in the stablecoin market.
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