Tether Holdings SA, the issuer of the world’s largest stablecoin, USDT, is reportedly in discussions to raise between $15 billion and $20 billion, aiming for a valuation of $500 billion. Major investors including SoftBank Group Corp. and Ark Investment Management LLC are involved in these preliminary negotiations, which could cement Tether’s status among the most valuable private companies globally.
Potential $500 Billion Valuation
If successful, this fundraising effort will be Tether’s largest attempt to secure external capital to date. A valuation of $500 billion would position Tether ahead of numerous leading global firms, reflecting the scale of its token issuance and the financial returns generated by its reserves. As a dollar-pegged stablecoin, USDT facilitates value transfer in cryptocurrency markets and beyond, providing investors with a method to transact outside conventional banking systems.
Supported by assets likened to cash, primarily U.S. Treasury bonds, Tether has reported substantial profits from interest income on these reserves. CEO Paolo Ardoino steers the company, while co-founder Giancarlo Devasini serves as president and remains its largest shareholder. Bloomberg estimates that a $500 billion valuation would value Devasini’s stake at nearly $224 billion.
Strategic Support from SoftBank and Ark
Tokyo-based SoftBank, under the leadership of founder Masayoshi Son, is known for its ambitious technology investments across various sectors, including autonomous vehicles and artificial intelligence. A potential investment in Tether fits with its strategy of pursuing disruptive opportunities, aligning with its planned $30 billion investment in OpenAI.
Ark Investment Management, led by Cathie Wood, has demonstrated a keen interest in digital assets and has previously invested in Circle Internet Group Inc., Tether’s closest competitor in the stablecoin space. Circle’s USD Coin (USDC) currently holds a market valuation of approximately $74 billion compared to Tether’s $173.5 billion in issued tokens.
The involvement of SoftBank and Ark could enhance Tether’s efforts to strengthen its presence in traditional finance and bolster its political legitimacy, particularly in the U.S., where it has faced scrutiny over its role in facilitating illicit transactions.
Advisory Role and Industry Impact
Cantor Fitzgerald LP, the New York-based investment bank led by current U.S. Secretary of Commerce Howard Lutnick, is advising Tether on its fundraising initiatives. The firm also provides custody services for Tether’s assets, underscoring its pivotal role in the company’s financial operations.
This funding round comes at a time when stablecoins are gaining significant attention from investors, regulators, and governments alike. As American authorities prepare for stricter oversight of digital assets, securing prominent backers may be crucial for Tether to position itself effectively in global markets. Should negotiations progress and funding be secured, Tether’s valuation would mark a significant milestone not only for the company but also for the broader cryptocurrency ecosystem, indicating a continued integration of digital assets into traditional finance.
