In 2024, Tether, the company behind the world's most widely used stablecoin, USDT, reported a staggering $14 billion in profit. What makes this achievement even more remarkable is that it was accomplished with a team of only 150 employees. This translates to approximately $93 million in profit per employee, leading many to consider Tether one of the most operationally efficient companies globally.
But how did a stablecoin issuer reach such heights? This article explores Tether's business model, strategic advantages, and vision for the future.
What Is Tether and How Does It Work?
Tether is best known for issuing USDT, a stablecoin pegged 1:1 to the US dollar. Essentially, USDT is a digital representation of the US dollar built on blockchain technology. It offers users around the world efficient access to dollar-based savings and payment systems, especially in cross-border transactions.
When someone purchases USDT, Tether holds an equivalent amount of real-world assets, primarily US Treasury bonds, to back the stablecoin. The company earns profit through the yield generated by these investments.
Tether’s Market Dominance
With a circulating supply of $147 billion, USDT is the leading stablecoin by a significant margin. Its closest competitor, USDC by Circle, has a market capitalization of approximately $62 billion—less than half of Tether’s supply.
While USDC focuses heavily on regulatory compliance and institutional adoption within the US, Tether has established a strong presence in international markets, particularly in regions with limited access to traditional banking and dollar liquidity.
The Secret to Tether’s Profitability
Tether’s astonishing profitability stems from several key factors:
- Minimal Operational Overhead: With only 150 employees, the company maintains a lean structure, avoiding bloated departments and excessive spending.
- Investment in US Treasuries: The majority of Tether’s reserves are held in US government bonds, which provide a safe and consistent return.
- Economies of Scale: As the adoption of USDT grows, so does the amount of capital under management, amplifying earnings.
In 2024, Tether became the seventh-largest buyer of US Treasury bonds, surpassing entire nations and regions like Canada, Taiwan, and Norway. The growth trajectory remains strong—USDT issuance increased by 57% in 2024, and user adoption grew by 13% in Q1 of 2025.
Leadership and Vision
Paolo Ardoino, Tether’s CEO, is a 40-year-old Italian computer scientist with a clear vision for the company. He believes that stablecoins serve a critical purpose: offering people in economically unstable countries reliable access to sound money.
In nations such as Argentina, Turkey, and Nigeria, local currencies often experience rapid devaluation, making saving nearly impossible. For many in these regions, USDT provides a lifeline.
Despite its international focus, Tether is also exploring opportunities to launch a native stablecoin tailored for US institutions—a move that could further solidify its market position.
Partnerships and Financial Backing
One of Tether's most significant relationships is with Cantor Fitzgerald, a well-established financial institution. At a time when many US firms were hesitant to partner with Tether, Cantor stepped in as its banking partner.
Cantor Fitzgerald is one of only 24 primary dealers authorized to trade directly with the US Federal Reserve. This partnership allows Tether to seamlessly convert US Treasury holdings into cash when users redeem USDT, providing unmatched liquidity and stability.
Recently, Cantor acquired a 5% stake in Tether for $600 million—a valuation widely seen as favorable, possibly reflecting Cantor’s early support and confidence in Tether’s model.
Resilience Under Pressure
Tether has faced its share of challenges, including a coordinated attack in 2022 by Sam Bankman-Fried and FTX. Over two days, FTX accumulated and sold billions of USDT in an attempt to trigger a bank run.
Tether successfully processed redemption requests totaling $7 billion—about 10% of its circulating supply at the time—without any operational disruptions. As Ardoino noted, most financial institutions would struggle to survive a 10% withdrawal shock over 48 hours, yet Tether emerged unscathed.
Addressing Criticism and Ensuring Compliance
Critics have often questioned Tether’s lack of a formal audit and raised concerns about potential misuse of USDT for illicit activities. The company has responded by highlighting its collaboration with law enforcement agencies worldwide.
Tether has assisted in over 400 US investigations and works with 230 agencies across 50 countries. The company uses blockchain analytics to monitor transactions and freeze suspicious funds, often catching activities that traditional financial systems miss.
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Expanding Beyond Stablecoins
Tether’s ambitions extend far beyond stablecoins. The company is investing in several cutting-edge sectors, including:
- Artificial Intelligence: Through investments in data centers like Northern Data, which operates 24,000 GPUs.
- Decentralized Communication: Tether is developing Keet, a peer-to-peer messaging app aimed at offering WhatsApp-like usability without central servers.
- Tokenization: The Hadron platform enables asset tokenization, opening new possibilities for digital ownership.
- Energy and Infrastructure: In underserved regions, Tether is piloting projects such as solar-powered battery leasing stations, where users pay 3 USDT per month for access to electricity.
These initiatives are not immediately profitable, but Tether’s strong core business allows it to experiment with long-term innovations.
Company Culture and Philosophy
Tether’s small team is highly dedicated. According to Ardoino, not a single employee left during the company’s most challenging periods—a testament to the team’s belief in Tether’s mission.
Many employees come from emerging markets, giving them firsthand insight into the problems Tether aims to solve. This alignment between personal experience and professional mission fosters exceptional loyalty and focus.
Ardoino describes Tether as a “once-in-a-hundred-years company” because it can pursue technological innovation without being pressured by short-term profitability demands. Revenue from USDT allows Tether to take risks on ambitious projects that prioritize user empowerment over profit.
Frequently Asked Questions
What is Tether?
Tether is a company that issues USDT, a cryptocurrency stablecoin pegged to the US dollar. It allows users to hold and transfer digital dollars on various blockchains.
How does Tether make money?
Tether invests the reserve backing for USDT primarily in US Treasury bonds. The yield generated from these investments constitutes the company’s profit.
Is USDT safe?
USDT is backed by a portfolio of highly liquid assets, including US Treasuries. Tether also partners with established financial institutions to ensure liquidity and stability.
Can USDT be used for payments?
Yes, especially in regions with high inflation or limited banking access. USDT is increasingly accepted by merchants and used in peer-to-peer transactions.
What makes Tether different from other stablecoins?
Tether focuses on global accessibility and financial inclusion, particularly in emerging economies. Its partnerships and scale provide liquidity advantages that competitors cannot easily match.
How does Tether handle regulation and compliance?
Tether works with global law enforcement agencies, uses monitoring tools to detect suspicious activity, and complies with international sanctions and regulations.
Conclusion: More Than a Stablecoin Company
Tether’s success is not just a story of financial efficiency; it is also about fulfilling a real-world need for stability and accessibility. By providing millions of people with access to a stable currency, Tether supports economic participation in regions where traditional systems fall short.
Under Paolo Ardoino’s leadership, Tether continues to innovate while staying true to the original ideals of cryptocurrency: decentralization, individual empowerment, and financial freedom. As the company expands into AI, communications, and energy, it remains committed to using technology as a force for stability and positive change.