Tether, the company behind the world’s largest stablecoin USDT, posted over $1 billion in operating profit for Q1 2025, according to its latest financial attestation. While still strong, the figure marks a sharp decline from the record-breaking $4.52 billion reported in Q1 2024.
The drop is largely attributed to a decrease in unrealized gains from Bitcoin and gold, which had significantly boosted earnings last year. In contrast, the company’s primary revenue source in 2025 was yield from U.S. Treasuries, reflecting a shift toward more stable, traditional financial instruments.
Tether now holds nearly $120 billion in exposure to U.S. government debt, including $98.5 billion in short-term Treasury bills. The rest is split between reverse repurchase agreements and money market funds.
Although the company didn’t publish an exact profit figure in its press release, it emphasized that traditional yield-bearing assets are increasingly central to its revenue model as crypto market gains moderate and institutional scrutiny rises.
Treasury Gains Offset Crypto Losses in Q1
Stablecoins like USDT serve as a crucial bridge between volatile crypto markets and fiat currencies. With $149 billion in circulation, Tether remains the dominant player in the stablecoin sector.
In Q1 2025, the firm allocated 66% of its reserves to U.S. Treasuries, generating over $1 billion in operating profit. Still, that’s a far cry from the windfall in Q1 2024, when Bitcoin’s 60% rally helped Tether post $4.52 billion in profit.
This year’s narrative was different. Bitcoin fell 12% in Q1, dragging down Tether’s crypto-linked profits. The company currently holds about 5% of its reserves in Bitcoin, valued around $7.7 billion—a portfolio that underperformed amid the Q1 correction.
However, market sentiment is shifting again. Bitcoin has rebounded to $97,000, up 4% year-to-date, raising hopes for a renewed crypto-driven earnings boost in future quarters.
Tether Plans U.S.-Specific Coin as Rules Tighten
In 2024, Tether posted $13 billion in profit, rivaling earnings from top Wall Street firms like Goldman Sachs, thanks in large part to Bitcoin’s explosive price growth. But 2025 is shaping up differently as regulatory pressure intensifies.
The company revealed Thursday that its exposure to U.S. Treasuries has reached nearly $120 billion, forming the foundation of its reserve strategy. This shift highlights a more conservative financial model as digital asset markets mature.
Meanwhile, new stablecoin legislation in Congress could reshape the rules for companies like Tether. The proposals would likely require non-U.S. issuers to conduct audits and register with U.S. regulators if operating domestically.
To navigate these challenges, CEO Paolo Ardoino has signaled plans to launch a U.S.-specific stablecoin tailored to meet local compliance standards—sidestepping full registration for USDT while retaining access to American markets.
Quick Facts
- Tether earned over $1 billion in Q1 2025, down from $4.52 billion in Q1 2024.
- U.S. Treasury exposure reached $120 billion by March 2025.
- USDT supply grew by $7 billion in Q1, reaching $149 billion.
- Reserves include 81.5% in cash equivalents, with exposure to gold and emerging sectors.
