Tether Expects $700M Profit in Q1, But Analyst Warns SEC May Take Action

• Tether Holdings Ltd is expected to make a $700 million profit in the first quarter of 2023.
• The success of USDT has been attributed to the misfortunes of its closest rivals, USDC and Paxos’s BUSD.
• Tether now holds short-dated US Treasury Bills held in trust by Cantor Fitzgerald, with Bahamia lenders Deltec Bank & Trust Ltd and Capital Union Bank looking after its reserves.

Tether Expecting $700 Million Profit

Tether Holdings Ltd, the blockchain fintech firm in charge of the issuance of the world’s largest cryptocurrency USDT is set to rake in a profit of $700 million for the first quarter of this year. According to a report by BNNBloomberg, the bogus earning was confirmed in an interview by Tether’s Chief Technical Officer Paolo Ardoino. The cumulative profit expected was almost at par with that from the fourth quarter of 2022.

USDC and BUSD Misfortune

For the past quarter, the total number of USDT in circulation topped $78 billion, up 18% in the year-to-date period. In hailing the performance milestones of Tether, Ardoino said the total USDT reserve is now up by an additional $1.6 billion. Tether’s misfortunes in the first quarter came to be attributed to the seemingly inevitable misfortunes of its closest rivals, USDC and Paxos’s BUSD. In the case of USDC it lost its peg earlier this month on grounds that its issuing company Circle has deep exposure to Silicon Valley Bank (SVB), which collapsed recently whilst Paxos experienced a crackdown from US SEC as a result of BUSD which it claims was sold as an unregistered security.

Reserve Security

Addressing issues around its reserve which have always been under contention, Ardoino said Tether now keeps hold of short-dated US Treasury Bills held in trust by Cantor Fitzgerald with Bahamia lenders Deltec Bank & Trust Ltd and Capital Union Bank looking after its reserves.

SEC Scare

Despite being a stablecoin Tether can best be described as a very volatile reliable asset owing to Fear Uncertainty and Doubt (FUD) created within industry circles when issues arise concerning regulation or some other external factor unrelated directly to USDT itself such as with Circle’s SVB issue mentioned above or more acutely with SEC’s clampdown on Paxos for selling BUSD as an unregistered security just last week..

Analysts Warning

Despite all these successes analysts warn that UDSC may still come under scrutiny from regulators particularly given recent events involving both Circle’s SVB issue and also that surrounding Paxos’ marketing tactics for BUSD last week leaving investors trading cautiously so not encounter similar experiences that befell Terraform Labs own UST stablecoin last summer..