3 Minutes
Overview
Tether, the issuer of the USDt stablecoin, has reportedly reduced plans to raise up to $20 billion after investor pushback, according to a Financial Times report. While advisers suggested trimming the strategy to as little as $5 billion, Tether’s leadership insists the company’s long-term valuation target remains intact. The move and surrounding commentary highlight ongoing scrutiny of valuations and fundraising strategies within the crypto sector.
Funding revision and investor skepticism
Sources familiar with the matter told the Financial Times that Tether’s advisers recommended lowering the proposed capital raise from the previously publicized $15–20 billion window to a far smaller target. Tether CEO Paolo Ardoino has characterized earlier figures as a “misconception,” saying the larger number represented a maximum the company was prepared to sell rather than a firm target.
Ardoino said, in effect, that the firm would be satisfied even if it ended up selling no new equity—signaling flexibility in fundraising amid weak appetite. Market participants have expressed concerns over both the size of the potential issuance and how it would impact Tether’s market position and stablecoin liquidity.
Valuation debate: $500 billion defended
Despite dialing back the planned raise, Tether has not abandoned a stated $500 billion valuation goal. Investors have reportedly questioned that figure privately, prompting Ardoino to defend it publicly by drawing comparisons with high-valuation technology firms. He cited AI companies whose market valuations soared despite operating losses, arguing that profit comparators could justify a large valuation for Tether based on its earnings profile.
The CEO’s comments follow Tether’s disclosure of a $10 billion profit for 2025—a 23% decline year-over-year—underscoring both the company’s profitability and the broader debate about how to value stablecoin issuers in an evolving regulatory and market landscape.
Tether’s US dollar-pegged stablecoin, USDt USDT $1 , is the largest in the world by market capitalization, currently totaling $185 billion.
In addition to USDt, the company operates the $3.6 billion gold-backed stablecoin XAUt and has been actively accumulating gold for its reserves, reporting holdings of 130 metric tons of physical gold to Cointelegraph in late January. Tether CEO highlighted the growth of the USDT-based stablecoin USDT0 on Wednesday. Source: Paolo Ardoino
Product lineup and market footprint
Beyond USDt, Tether manages XAUt, a gold-backed stablecoin, and recently launched USAt, a U.S.-market-focused stablecoin issued through Anchorage Digital Bank under the GENIUS Act. At publication, USAt’s market cap was modest, reported at about $20 million on CoinGecko, but it has shown initial growth since launch.
These product initiatives, along with Tether’s reported accumulation of gold reserves, are central to the company’s broader strategy to diversify collateral backing and reinforce investor confidence in its stablecoin offerings.
What to watch next
Market participants and regulators will likely monitor whether Tether moves forward with a reduced capital raise and how it defends or adjusts its public valuation target. Any change to reserve composition, additional fundraising, or new product rollouts could influence stablecoin market dynamics, liquidity, and regulatory scrutiny in the months ahead.
Source: cointelegraph
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