Tether CEO Pushes Back After S&P Downgrades USDt To Lowest Rating

Tether CEO Paolo Ardoino issued a sharp rebuttal after S&P Global assigned the company’s USDt stablecoin its lowest score under the agency’s five-tier risk framework. 

The downgrade, from “4 (constrained)” to “5 (weak),” was announced Wednesday and based on what S&P described as growing exposure to higher-risk assets and ongoing disclosure gaps.

According to S&P, Tether’s reserves now include larger allocations to Bitcoin, gold, corporate debt, secured loans, and other investments with “limited disclosures” and exposure to credit and market risks. 

The agency also cited limited transparency around custodians and counterparties, though it acknowledged USDt has maintained “a notable level of price stability” during periods of volatility.

Tether rejected the assessment, saying it “strongly disagrees with the characterization presented in the report” and arguing that S&P relied on “a legacy framework” that does not reflect the scale or economic role of digital money.

Ardoino went further, characterizing the downgrade as an example of traditional finance resisting newer models. 

He said the company “wear[s] your loathing with pride” and argued that classical rating methodologies have historically failed to identify risks in legacy institutions. 

He added that established financial players are “growing worried when any company tries to defy the force of gravity of the broken financial system,” and maintained that Tether is “the first overcapitalized company in the financial industry, with no toxic reserves.”

Tether, headquartered in El Salvador, says it has issued about $184 billion in USDt and maintains full backing through U.S. Treasuries and other reserve assets. 

The company said it has “processed billions in redemptions while maintaining uninterrupted stability” and describes the stablecoin as “systemically important financial infrastructure” in emerging markets where it is widely used for transactions.

S&P introduced its stablecoin rating scale in 2023 to evaluate the risk profiles of digital assets pegged to government-issued currencies.