Key Insights:
- Tether’s fundraising plans had been cut following valuation and market issues raised by advisers.
- The company recorded reduced 2025 profits as reserves, while USDT supply continued to increase.
- The introduction of USAt with the help of Anchorage Digital Bank was supported by new US stablecoin rules.
Tether’s fundraising plans have shifted significantly as the issuer of the world’s largest stablecoin evaluates the scale of an equity raise first outlined last year. The company, best known for issuing the USDT stablecoin, has pulled back from a previously discussed $20 billion funding target after advisers and investors raised questions about valuation and market conditions, according to people familiar with the matter.
Tether Fundraising Re-evaluated following Investor Concerns
In a report released by the Financial Times on Wednesday, advisers to Tether recommended a capital raise as low as $5 billion.
The original plan, announced in the fall of last year, had floated a potential raise of between $15 billion and $20 billion. People familiar with the discussions stated that investor skepticism played a role in prompting the reassessment.
Tether Chief Executive Officer Paolo Ardoino sought to clarify earlier reports, stating that the higher figures reflected a ceiling rather than a firm objective.
He told the Financial Times that the $15 billion to $20 billion range represented the maximum equity the company was prepared to sell, not a target amount. Ardoino added that Tether would also be satisfied if no equity were sold.
Despite the scaled-back expectations for Tether fundraising, the company has not abandoned its internal valuation target of $500 billion.
Valuation Debate and Comparisons to AI Firms
Ardoino defended the $500 billion valuation target by comparing it to that of artificial intelligence companies. He cited examples of AI platforms that have achieved valuations similar to or higher than those of companies that operate at a loss.
In comments reported by the Financial Times, Ardoino said Tether’s profitability compared favorably with that of those firms, noting that some AI companies generate similar revenue figures but report negative earnings.
Source: The Block
These remarks followed reports that an AI firm reached a valuation of roughly $500 billion after a share sale involving SoftBank in October.
Ardoino argued that valuation frameworks applied to fast-growing technology companies should also be applied to stablecoin issuers with consistent profits.
Profit Decline Adds Complexity to Tether Fundraising
Tether disclosed in late January that it recorded a net profit of $10 billion for 2025, representing a 23% decline from the $13 billion reported the previous year.
The company attributed the drop to accounting adjustments that may be linked to fundraising preparations, as well as pressure from higher interest rates and reduced yields on U.S. Treasury-backed reserves.
At the same time, Tether reported that its reserves grew to $193 billion, with $186 billion in USDT circulation. According to the analysts mentioned in the report, reporting a decrease in profits and considering an equity sale would burden investor emotions.
Regulatory progress and expansion to the U.S. market
Recent regulatory changes in the United States have also shaped the environment for Tether fundraising. Ardoino said that newly signed U.S. legislation governing stablecoins has helped move discussions forward. To comply with regulatory requirements, Tether launched a U.S.-specific stablecoin, USAt.
It is an issued token on Anchorage Digital Bank intended to support the GENIUS Act. By the time of publication, the market capitalization of USAt had reached $20 million, according to CoinGecko data, up from $10 million at launch.
Since 2014, the company has faced repeated questions over the use of USDT in illegal transactions and the transparency of its reserves. Tether currently publishes quarterly assurance reports through BDO Italia but has not released a full independent audit.
Ardoino said potential investors have been shown how the company cooperates with law enforcement agencies and the transaction-monitoring tools it uses to track activity.
Stablecoin Scale and Reserve Composition
USDT remains the largest stablecoin globally, with a market capitalization of approximately $185 billion. After its dollar-pegged token, Tether runs XAUt, a gold-backed stablecoin worth $3.6 billion on the market.
The company has also grown its physical gold reserves to 130 metric tons as of the end of January.
By February 2026, the Tether funding scheme will still be under development, and no deals will have closed. According to market participants, any further downward adjustment to fundraising goals or the inability to secure commitments may indicate additional pressure on valuation expectations.
