Tether faces regulatory hurdles in Europe due to MiCA regulations, leading to USDT delistings from exchanges like Crypto.com and Coinbase.
Tether, the issuer of stablecoins, has announced a net profit of $13 billion for the year 2024, attributed to the increasing prices of Bitcoin and gold.
The company responsible for issuing the largest stablecoin, USDT, reported a profit of $6 billion in the final quarter of the year. Tether’s total assets amounted to $143.7 billion, while its excess reserves increased to $7 billion.
The company’s most recent financial report, which was approved by the accounting firm BDO Italy, showed that a big chunk of its profits came from U.S. Treasuries and unrealized gains from Bitcoin and bullion holdings.
Bitcoin and Gold Drive Tether’s Profits
By the conclusion of 2024, Tether had augmented its Bitcoin holdings to nearly 84,000 BTC. Tether, the issuer of stablecoins, has disclosed that its profit of $13 billion was derived from various sources, with the appreciation of Bitcoin and gold significantly contributing to this financial outcome.
Approximately $5 billion of the overall profit was attributable to the appreciation in the value of these assets. Yields on U.S. Treasuries and repurchase agreements provided the remaining $7 billion.
The company augmented its Bitcoin holdings in the fourth quarter of 2024, signifying its inaugural action of this nature since March. By the conclusion of the year, Tether possessed approximately 84,000 BTC, valued at an estimated $7.8 billion.
The firm’s holdings of U.S. Treasury securities increased to $94.5 billion, thereby strengthening its asset reserves. In 2024, Tether’s stablecoin, USDT, experienced substantial issuance, totaling $45 billion over the course of the year.
During the fourth quarter, the corporation issued a total of $23 billion in new USDT tokens. The overall market capitalization of USDT has attained $140 billion, positioning it as the fourth-largest cryptocurrency.
USDT continues to play a vital role in the cryptocurrency market, especially within developing economies. Tether has announced that its stablecoin currently boasts a user base of 400 million individuals globally, with the majority of adoption taking place in developing regions.
The corporation is actively enhancing the role of USDT in the domains of payments, remittances, and savings. Notwithstanding its expansion, the stablecoin issuer Tether encounters regulatory challenges, particularly within the European context.
The implementation of the European Union’s Markets in Crypto-Assets (MiCA) regulations has resulted in the removal of USDT from numerous exchanges.
Crypto.com has recently declared its intention to eliminate USDT and nine additional tokens from its European platform by January 31, 2025. The Markets in Crypto-Assets (MiCA) regulations stipulate that stablecoins must possess an electronic money license in order to function within the European Economic Area (EEA).
Tether has not obtained the requisite authorization, resulting in heightened scrutiny. In 2024, several other exchanges, including Coinbase, removed USDT from their listings for analogous reasons.
Tether’s Plans and Expansion into New Sectors
Users on the impacted platforms are required to convert USDT into assets that comply with MiCA regulations by March 31, 2025. The issuer of USDT is actively broadening its scope beyond stablecoins, with intentions to venture into new industries by the year 2025.
The company has announced forthcoming initiatives in the fields of artificial intelligence, telecommunications, and financial services. Tether seeks to improve cryptocurrency transactions and remittances by incorporating USDT with Bitcoin’s Lightning Network.
Tether’s Chief Executive Officer, Paolo Ardoino, underscored the company’s commitment to innovation, asserting that the integration with the Lightning Network is anticipated to enhance the transaction speed of USDT and reduce associated fees, thereby providing advantages to users worldwide.
Simultaneously, in accordance with previous reports, Tether has recently disclosed its intention to relocate its headquarters to El Salvador as a component of its expansion strategy.
