Cryptocurrency company Tether, which issues stablecoin USDT (USDT), expects to earn $700 million in revenue in the first quarter of 2023, matching the revenue in the last quarter of 2022, Tether’s chief technology officer Paolo Ardoino told Cointelegraph at Paris Blockchain Week 2023.
“I don’t have the final numbers yet, but the profit this quarter may be in line with the last quarter of 2022,” Ardoino said, adding that in Q4 2022, Tether generated $700 million in profit. He added that Tether also has “an additional $950 million” by December 31, 2022, noting:
“So that means our company’s equity will grow to $1.5 billion or $1.7 billion which is on top of the reserves that we have that support 100% of our assets.”
Tether CTO later said that USDT is more “the safest asset to hold in the world” because the company is different from banks that are based on a fractional reserve model. He specifically mentioned the crisis in the United States banking system, with banks like Silicon Valley Bank (SVB) collapsing due to the fractional reserve model.
Ardoino also mentioned that he has become a fan of the main cryptocurrency Bitcoin (BTC), which is the hedge of Tether, stating:
“I like Bitcoin and that’s our hedge and that’s why we’re in Bitcoin, because we don’t trust guys who take too much risk for their customers’ deposits.”
As previously reported, Tether aggressively cut its commercial paper support last year, eventually reducing it to zero by the end of 2022. In addition to removing commercial paper from its reserves, Tether replaced its investment with US Treasury Bills.
The news comes amid Tether’s continued increase in market dominance, with USDT’s market capitalization adding about $8 billion since February 28. At the time of writing, the market value of USDT is at $79 billion, which is the highest level since May 2022, according to data from CoinGecko.
While USDT’s market dominance has grown, rival stablecoin Circle USDC has been losing market share, with its market cap down 18% since the end of February.
related: Tether CTO on USDC depeg: ‘Bitcoin maxis are right all together’ | PBW 2023
Circle has faced a major problem due to its exposure to the collapse of SVB, with its stablecoin USDC quickly losing 1:1 against the US dollar. The stablecoin was then re-installed amid Circle announcing Cross River as a new banking partner and developing a relationship with BNY Mellon.
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