Tether Q3 Attestation: 85.7% Cash Reserves, $330M Loan Cut, $670M Research Spend

In a newly published assurance opinion, Tether Holdings Limited disclosed its financial standing for Q3 2023, substantiated by a comprehensive assessment conducted by BDO, a globally recognized independent public accounting entity. The attestation, dated October 31, 2023, reaffirms the veracity of Tether’s Consolidated Reserves Report (CRR) as of September 30, 2023, offering a detailed breakdown of the assets maintained by the Group.

Reserve Composition and Liquidity Maintenance

A notable revelation from the CRR is the record percentage of reserves Tether now holds in Cash and Cash Equivalents (C&Ceq), marking a historic 85.7%. A significant portion of these reserves, amounting to US$ 72.6 billion, is held in US Treasury Bills, depicting both direct and indirect exposure. This strategic allocation accentuates Tether's ongoing commitment to ensuring liquidity and fostering stability within the broader stablecoin sphere.

Prudent Financial Management

Further emphasizing prudent financial management, the report elucidates a substantial contraction in secured loans extended by Tether, exceeding $330 million, augmenting confidence in the firm’s judicious asset management approach. This reduction aligns with Tether’s publicly declared ambition of diminishing, and eventually eliminating, secured loan exposure from its reserves, leveraging its surplus reserves and undistributed profits to attain this objective.

Investment in Research and Excess Reserves

Tether's financial disclosure also unveiled investments exceeding $670 million in Q3 2023, and over $800 million year-to-date, funneled into industry-aligned research domains. Although these investments are external to the reserves backing the issued tokens, they showcase Tether’s long-term vision and resilience, particularly amid fluctuating gold and Bitcoin valuations. The report confirmed a stable excess reserves buffer, in spite of market volatilities, with a fair value evaluation causing a diminution of US $116 million for gold inventory and US $195 million for Bitcoin positions as of end Q3 2023.

Independent Verification and Assurance

BDO’s independent attestation reinforced that Tether’s consolidated assets, evaluated at a minimum of US$ 86.4 billion, surpassed its consolidated liabilities amounting to US$ 83.2 billion, with US$ 83.15 billion pertaining to digital tokens issued. This positive assessment underscores the robust financial health of Tether Group, even as it continues to diversify its investment portfolio into sustainable energy, Bitcoin mining, data, and P2P technology, with Q3 2023 investments in these sectors reaching nearly US$ 669 million, totaling around US$ 809 million since the onset of the year.

The Q3 attestation stands as a testament to Tether's unwavering commitment to transparent and responsible financial stewardship, fortifying its position as a credible and stable entity in the crypto-finance ecosystem.