S&P Global Ratings downgraded Tether’s stability rating, calling USDT’s reliance on risky assets a ‘deep vulnerability.’ In response, Tether states that the analysts’ conclusions ‘mean nothing’ and do not reflect the real state of reserves.
‘Weak’ rating due to reserve structure
The agency assigned USDT the status of ‘weak,’ lowering it from the ‘constrained’ category. The formal reason is that Tether uses more risky asset classes, including bitcoin, gold, corporate bonds, and secured loans.
S&P notes that the company has not provided a full audit of its reserves, publishing only brief attestations. Despite this, Tether claims it is fully backed by liquid instruments, including short-term US Treasury bills.
Tether: ‘The metric means nothing’
Tether CEO Paolo Ardoino sharply criticized the rating. He said:
‘We proudly wear your dislike,’ adding that the agency has for years given high ratings to instruments that later became sources of financial crises.
According to Ardoino, the company is ‘overcapitalized’ and does not hold toxic assets.
87 thousand BTC on Tether’s balance sheet
Tether’s reserves increased the share of BTC, making the stablecoin more dependent on volatile collateral.
In recent years, Tether has accumulated more than 87,000 BTC. According to the company’s reports, this bitcoin is part of the ‘excess reserve’ and was not used directly to back USDT. But the S&P report emphasizes that the very fact of increasing the share of BTC in reserves adds additional risk.
The share of bitcoin rose from 3.6% to 5.4%, while the total volume of USDT exceeds $184 billion. Analysts warn: a sharp drop in BTC, along with a decline in other risky assets, could lead to a decrease in USDT coverage and the risk of undercollateralization.
USDT remains stable
Despite the criticism, there are no signs of USDT losing its peg. The stablecoin maintained its dollar rate even amid a bitcoin downturn.
Tether also emphasizes that it is the 17th largest holder of US Treasury bills, which, according to the company, demonstrates a high level of reliability.
But S&P voices other concerns as well: banking opacity, lack of precise information about custodians, and the absence of an official direct redemption mechanism for USDT — unlike the competing USDC.
Tether increases gold holdings
At the same time, Tether is actively increasing the amount of gold on its balance sheet. The company has expanded the issuance of the XAUT token, and growing demand for RWA makes such assets one of the main drivers of Tether’s current strategy.
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