Tether has recently made a significant impact in the financial landscape by establishing itself as a major player in the U.S. government debt arena. Now ranked as the 19th-largest holder of U.S. Treasuries, it showcases how private entities are increasingly stepping into territory traditionally dominated by nations.
Tether Overtakes Significant Global Players
As reported in the latest quarterly attestation report for Q1 2025, Tether’s holdings in U.S. Treasuries have reached an impressive $120 billion. This figure surpasses Germany’s holdings of $111.4 billion and signals a major shift where a stablecoin issuer now outpaces a prominent sovereign investor. This development underscores the evolving financial strategies that crypto firms are adopting, utilizing traditional bonds to underpin digital currencies.
Importance of Tether in U.S. Debt Instruments
According to insights from the U.S. Treasury Department, Tether was the seventh-largest purchaser of U.S. Treasuries in 2024, surpassing traditional investors from Canada, Mexico, Taiwan, and Norway. These investments in short-term securities have positioned Tether as a reliable asset for issuers of dollar-pegged tokens.
In 2024, Tether emerged as the 7th largest buyer of U.S. Treasuries, ahead of numerous nations pic.twitter.com/fEANUL3fb2
— Paolo Ardoino
(@paoloardoino) March 20, 2025
This increasing demand for U.S. Treasuries not only assists the U.S. government in managing its significant borrowing needs but also raises critical questions regarding financial transparency. Tether’s approach of issuing attestations rather than comprehensive audits adds an element of uncertainty in a sector where trust is paramount.
Remarkable Financial Performance
According to data released by Tether, the company reported profits exceeding $1 billion from its traditional investments in Q1 2025, a substantial portion of which stemmed from its Treasury holdings. These figures illustrate the potential for safer investment avenues to yield substantial returns, even in turbulent market conditions.
Moreover, Tether’s investments in gold have contributed significantly by buffering fluctuations in the cryptocurrency markets, highlighting the benefits of diversification in a volatile environment. Sustaining these favorable outcomes, however, requires maintaining low borrowing costs and stable market conditions.
From 0 to $150B.
Born in 2014, Tether has not only introduced USD₮ — it has kickstarted the entire stablecoin ecosystem.
As of now, USD₮ enjoys trust from over 400 million users and drives the digital economy forward.
To all users, developers, and believers: thank you
We are just at the beginning #UnstoppableTogether pic.twitter.com/PPC2PUy1Si— Tether (@Tether_to) May 12, 2025
Explosive Growth in USDT Market Cap
Recent analyses indicate that USDT’s market capitalization has surged past $150 billion for the first time, reflecting an increase of more than $11 billion since the beginning of the year. In the last year alone, over 250 million users have executed approximately 5.8 billion transactions, amounting to a staggering $33.6 trillion.
Data from Visa reveals that approximately 192.2 million addresses have engaged in the purchase of stablecoins, while around 242.7 million addresses received them. Forecasts suggest that stablecoins could escalate to a value of $1.6 trillion by 2030, with Standard Chartered predicting they might reach $2 trillion by 2028.
Tether is also expanding its offerings; it recently introduced Tether Gold (XAUₜ) on Maxbit, a licensed Thailand-based exchange, on May 13, 2025. This initiative follows Thailand’s 2025 policy adjustment allowing for unrestricted trading of USD-backed stablecoins, thus facilitating easier access to tokenized gold and USDT in the rapidly growing Asian markets.
Tether’s ascension into the echelons of the top 20 U.S. debt holders signals a broader trend of stablecoin issuers increasingly investing in Treasuries, becoming vital contributors to the pool of dollar liquidity. This not only stabilizes the often volatile crypto market but also positions private entities at the core of one of the world’s largest financial markets.
Image credit sourced from Unsplash, chart provided by TradingView
