The USDT stablecoin issuer, Tether Holdings Limited, reported a profit of $850 million for the second quarter of the year, which means that its total excess reserves now stand at $3.3 billion.
The profits
A spokesperson for the company said that the profits retained for the second quarter stand at about $850 million and they have resulted in the rise in excess reserves.
They said that this was essentially additional capital that could be used for further strengthening the company.
According to the report, there was an increase of almost 30% in the operational profits of the company between April and June 2023, as they crossed the $1 billion mark.
An accounting firm based in Belgium, Binder Dijker Otter (BDO) prepared the attestation in question.
The USDT stablecoin, owned by Tether, is currently the largest stablecoin in the world by market cap. According to CoinGecko, its market cap at the time of writing stands at about $84 billion.
Digital assets that are pegged to fiat currencies in a 1:1 ratio are called stablecoins and the USDT is pegged to the US dollar.
The reports
Since 2017, a total of 14 reports have been published by Tether for providing details about its reserves. There had been some criticism directed towards the company back in 2021.
This was because a substantial amount of cash of the company was in the form of a short-term unsecured corporate debt i.e. commercial paper.
Back then, markets had been rattled because of Evergrande, the property developer in China, because it had seemed that the company would not be able to meet its obligations worth billions of dollars.
However, Tether announced in October last year that commercial paper had been removed from its reserves completely.
In the report published on Monday, the company disclosed that it had highly liquid reserves, as almost 85% of its investments were actually held in the form of cash and cash equivalents.
Treasury exposure
For the first time, the report also revealed the indirect exposure the company has to US Treasury bills through money market funds.
It also has exposure to Treasures that collateralize the Overnight Repo and the total combination means that the exposure of the USDT to US Treasuries stands at about $72.5 billion.
In addition, the company further disclosed that it had also invested in initiatives related to energy and a share buyback had also been conducted worth $115 million.
The company spokesperson said that a share buyback program of about 10% of the existing shares had been conducted this quarter to give investors the opportunity to sell their shares.
They said that only a marginal number of shares were purchased and they had used the profits of the quarter for financing it.
According to the report, the company has $87 billion worth of consolidated total assets, while its liabilities stand at about $83 billion, which are related to the issued digital assets.
The CTO of Tether, Paolo Ardoino, stated that he was proud of the company’s latest reserves attestation because it shows their commitment to transparency.