Tether, the issuer of the world's largest stablecoin USDT, has dramatically scaled back its private fundraising ambitions after facing investor pushback over a proposed $500 billion valuation. Initial reports indicated the company was exploring a raise between $15 billion and $20 billion, but advisers are now considering a significantly smaller round closer to $5 billion.
Tether CEO Paolo Ardoino clarified that the $15–$20 billion target was a "misconception" and stated the company never formally committed to that scale. He emphasized that Tether would be "very happy" raising zero capital, highlighting the firm's strong profitability. Tether reported $10 billion in profits for 2025, though this was down about 23% from the prior year due to Bitcoin price declines, offset by strong returns on gold holdings.
The investor skepticism centered on justifying the lofty $500 billion valuation in current market conditions, with concerns cited over regulatory scrutiny, reserve transparency, and past allegations of illicit use. A recent S&P Global Ratings downgrade also highlighted Tether's exposure to riskier assets like Bitcoin and gold, noting limited disclosures on the creditworthiness of its custodians and counterparties.
This strategic reset reflects a broader shift in crypto finance, where investors now demand stronger fundamentals, predictable revenue, and regulatory clarity. The move places Tether's funding plans under sharp focus across the digital asset ecosystem, given the company's central role in global crypto liquidity and trading activity with its $185 billion USDT stablecoin.
The retreat also reshapes expectations for a potential Tether IPO, which had been fueled by speculation from crypto insiders like BitMEX co-founder Arthur Hayes. While a public listing is no longer imminent, regulatory tailwinds—including US stablecoin legislation under President Trump and Tether's new US-compliant USAT token—could provide a pathway for legitimacy and a potential 2026 IPO if market conditions improve.
