Leading stablecoin issuer Tether has published its 2023 second quarter (Q2) attestation report, which shows an $850 million increase in excess reserves to reach $3.3 billion. Excess reserves are the company’s profits that are not distributed to shareholders. The company holds these funds on top of the 100% reserves it maintains to back its stablecoins.
$1B in Operational Profits
The report, audited by prominent accounting firm BDO, revealed that Tether’s operational profits exceeded $1 billion from April 2023 to June 2023, marking a significant increase of 30% from Q1.
Tether stated that it would carry out a $115 million share buyback as part of a “healthy sign of consolidation” to further strengthen its group. The company also disclosed that other investments in energy-related initiatives have been financed by profits from this quarter.
“The investment in energy-related initiatives are not included in the [Q2 attestation report] as these are not considered by Tether as an eligible reserve for the token in circulation,” Tether said.
Tether Reserves Remain Liquid
The stablecoin issuer stated that its reserves remain extremely liquid, with 85% of its cash and cash equivalents investments. The attestation estimates consolidated total assets of $86.4 billion against consolidated total liabilities of $83.17 billion.
The Q2 attestation disclosed Tether’s direct and indirect exposure (through money market funds) to US Treasury bills as well as the Treasuries collateralizing its overnight Repo. The report stated that by aggregating them, the total amount of Treasuries backing Tether’s stablecoins is approximately $72.5 billion.
Citing recent banking and crypto industry issues, Tether stated that the latest attestation report highlights the need to take proper risk management measures and care for users.
Commenting on the development, Paolo Ardoino, CTO of Tether, said:
“With a firm focus on transparency, we aim to shape a future where every participant in the global financial ecosystem can confidently navigate a realm built on trust and innovation. That’s why in this quarter, Tether’s USD₮ token in circulation surpassed its previous all-time high.”
