Tether's Reported Profit Is Declining – Forbes
Date: 2023-08-09 Author: Karina Ziganova Categories: BUSINESS
The USDT stablecoin issuer, Tether, reported a 30% increase in operating profit last week, but said nothing about net income. Forbes drew attention to this.
Journalists note that in the second quarter of 2023, the company received more than $1 billion in operating profit. This is 30% more than in the previous three months. This growth was estimated to bring Tether a net profit of $1.92 billion. However, the company did not disclose its size in the last quarter.
“Tether’s significantly increased operating income was almost $500 million lower than the previous quarter’s net income,” the article says.
Moreover, the journalists note that the company did not define operating income in the report and did not explain why it no longer reports net income, as in the previous two quarters. Forbes suggests that this may indicate that Tether's profits are declining.
Tether Q1 Report
Between January and March 2023, the company posted a profit of $1.48 billion, and the number of tokens in circulation increased by 20%, which was “a clear indication of the trust of Tether customers.” At the same time, the total consolidated liabilities amounted to $79.4 billion, and the company's excess reserves - $2.44 billion.
Then the company announced that they were working to reduce dependence on bank deposits. Now Tether uses them as a source of liquidity, but intends to use the repo market as an alternative.
Who Controls Tether Reserves
Despite the significant profitability of the company, questions about Tether reserves often arise in the crypto community. In particular, journalists found out that Cantor Fitzgerald, an American Wall Street company, manages $39 billion in Tether bonds — about half of all reserves.
The media speculate that the centralization of such a significant amount of Tether reserves in the hands of one firm speaks of Wall Street's willingness to turn a blind eye to the dubious past of cryptocurrency companies in order to manage billions of dollars of assets.
