Tether (USDT): Stablecoin Market Leader Despite Regulatory Pressure
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Key Takeaways
- Tether holds 70 percent market share among stablecoins and is used by more than 350 million users worldwide (as of July 2024)
- As of August 2024, Tether held reserves of 118.4 billion US dollars with a market capitalization of over 114 billion US dollars
- In the first half of 2024, Tether generated a profit of 5.2 billion US dollars
- Since April 2025, Tether has been under heightened SEC scrutiny regarding whether USDT qualifies as a compliant stablecoin
- Tether has frozen 3.29 billion US dollars in USDT tokens and works with over 275 law enforcement agencies in 59 countries
- JP Morgan warned that a loss of confidence in Tether could trigger a severe liquidity shock for the entire crypto market
Tether (USDT) is the dominant stablecoin in the crypto market with a 70 percent market share and is used by over 350 million users worldwide. The token, issued by Tether Limited Inc., is pegged to the US dollar and already surpassed Bitcoin in 2019 as the most-traded cryptocurrency globally.
Business figures and reserve structure
As of August 1, 2024, Tether held reserves of 118.4 billion US dollars, which exceeded the amount of USDT tokens in circulation. At that time, the company reported excess reserves of 5.3 billion US dollars and equity of 11.9 billion US dollars. Market capitalization stood at over 114 billion US dollars.
In the second quarter of 2024, Tether generated a profit of 1.3 billion US dollars. For the entire first half of 2024, profit totaled 5.2 billion US dollars. The reserves consist of a mix of cash, US Treasury bonds, secured loans, precious metals, and other assets.
By December 2024, the number of USDT tokens in circulation rose to approximately 135 billion.
Token mechanism and technical infrastructure
Unlike cryptocurrencies with a fixed cap like Bitcoin, Tether adjusts its supply dynamically. New USDT tokens are minted when eligible customers deposit fiat currency with Tether. Tokens are removed from circulation when users redeem them for fiat currency. A stablecoin is a cryptocurrency pegged to a stable asset like the US dollar to minimize price volatility.
As of January 2024, Tether's official website listed 14 protocols and blockchains on which USDT is available. Major trading venues in 2025 included Binance with an average daily USDT trading volume of 36.6 billion US dollars, Bybit with 7.9 billion US dollars, and OKX with 6.5 billion US dollars.
Regulatory pressure and transparency concerns
On April 5, 2025, the US Securities and Exchange Commission (SEC) tightened its rules for stablecoins. Since then, Tether has been under review to determine whether USDT meets the new compliance requirements for regulated stablecoins. The SEC defined new criteria for which stablecoins are considered non-compliant.
Already on September 13, 2024, an American regulatory authority criticized that the lack of transparency about Tether's reserves endangered consumers and called on the company to undergo an independent audit. The absence of regular, independent audits also raised regulatory concerns in the EU and Canada.
Systemic risk assessment by JP Morgan
A JP Morgan report found that USDT performs many functions in the crypto world that banks fulfill in traditional finance—but without comparable oversight and without deposit insurance. The bank warned that a situation in which market participants would no longer be willing or able to use Tether tokens would "most likely trigger a severe liquidity shock for the broader crypto market."
Compliance and law enforcement
According to figures from 2025, Tether works with over 275 law enforcement agencies in 59 countries. The company has frozen 3.29 billion US dollars in USDT tokens and added over 7,000 addresses to a blocklist. These measures aim to curb illegal activities in the USDT ecosystem.
Ownership structure and founders
Tether Limited is controlled by iFinex, a company based in the British Virgin Islands that also operates the crypto exchange Bitfinex. The stablecoin was founded in 2014 under the name Realcoin by Brock Pierce, Reeve Collins, and Craig Sellars.
Brock Pierce founded Blockchain Capital in 2013, which raised over 80 million US dollars by 2017. Collins served as CEO of Tether in the first two years and led SmarMedia Technologies from 2020 onwards. Sellars worked for more than six years with the Omni Foundation and its Omni Protocol, which enables smart contract-based features on the Bitcoin blockchain.
Market position despite criticism
Despite ongoing transparency concerns, USDT remains the most-traded and most widely accepted stablecoin, particularly in emerging markets and on exchanges with high trading volumes. The combination of liquidity, global availability, and network effects secures Tether's market leadership, while regulatory uncertainty could affect its long-term position.