Tether generated $4.5 billion in net operating profit during the first nine months of 2026, according to its third-quarter attestation released Friday. However, the stablecoin's safety buffer has become increasingly dependent on volatile assets, with its $7.95 billion cushion now smaller than the $8.37 billion in Bitcoin held in reserves.
The buffer nearly doubled from $4.11 billion at the end of Q2, though the attestation prepared by accounting firm BDO attributed only $1.66 billion of growth to the operating profit. The remaining increase reflected price movements in gold and Bitcoin, the two assets that comprise the reserve's most volatile holdings.
Vulnerability to Asset Prices
Gold and Bitcoin together total $27.45 billion in reserves. According to calculations based on attested figures, a combined 29% decline in these assets would eliminate the entire buffer. This concentration creates exposure that BDO noted assumes normal trading conditions rather than market stress scenarios.
The reserve composition now includes $47.7 billion in gold, Bitcoin, secured loans, and other investments—25% of total reserves. The remaining 73%, approximately $139.6 billion, sits in US Treasury bills, reverse repos, and cash.
Prior Concerns and Tether's Defense
S&P Global Ratings downgraded USDT to its lowest stability score, "weak," in November 2025, citing Bitcoin exposure above the buffer level and undisclosed custodians and counterparties.
Tether's CEO Paolo Ardoino emphasized in the release that the company's responsibility is ensuring USDT "remains dependable when people need it most, including when markets and financial systems come under pressure."
With USDT in circulation holding near $183.5 billion, the buffer has fluctuated between $8.23 billion and $4.11 billion within a single year. Despite completing its first clean KPMG audit, the world's largest stablecoin now depends significantly on gold and Bitcoin valuations to maintain its reserve cushion.
