Markets · Markets
Tether says it made $1.5 billion, mostly from Treasury bills and repo
A BDO report puts Tether's directly held T-bills at $122.8 billion and its excess reserves at $7.95 billion as of Sept. 30. The profit figures are Tether's own and were not attested.
Tether, issuer of the largest dollar stablecoin, held $122.8 billion of U.S. Treasury bills directly at Sept. 30, according to a report by accounting firm BDO, an independent assurance report Tether calls an attestation, not an audit. The same report puts its total assets at $191.45 billion and its excess reserves, the assets left over after all liabilities, at $7.95 billion [2]. Tether's release says the company booked $1.5 billion of "net operating profit" in the third quarter and $4.5 billion over nine months [1]. Those profit figures are not part of what BDO checked.
That leaves two numbers to keep separate. The balance sheet is attested. The profit claim is Tether's own.
How the money is made
Tether issues USDT, a token meant to be worth one dollar. Its release puts circulation at about $184 billion [1], and BDO's report shows a liability for tokens issued of $183.47 billion [2]. Holders earn no interest. Tether invests the dollars that back the tokens, mostly in short-dated government debt, and keeps the return.
Tether's release says as much: "U.S. Treasury bills and reverse repurchase agreements continued to provide most of this income" [1]. A reverse repurchase agreement is a very short loan of cash, backed by Treasuries as collateral. In its Q2 release, Tether described its profit as "led by U.S. Treasury and repo" [3].
The mechanism is simple. Because the bills are short-dated, they mature and are rolled into new ones within weeks or months. When T-bill yields fall, each new bill pays less, so the same pile of reserves produces less income. When yields rise, it produces more. Tether gives no yield or interest-income figure in either the release or the report, so the size of that effect can't be calculated from what it published.
What the report shows
BDO's report lists the reserves by category as of Sept. 30 [2]:
- U.S. Treasury Bills: $122.84 billion
- Precious Metals: $19.08 billion (physical gold bars, per the report's notes)
- Secured Loans: $14.18 billion
- Overnight Reverse Repurchase Agreements: $9.52 billion
- Bitcoin: $8.37 billion
- Term Reverse Repurchase Agreements: $7.18 billion
- Other Investments: $6.00 billion
- Public Equities: $4.18 billion
| Category (BDO report) | US$ bn | Share of total (Le Coin's math) |
|---|---|---|
| U.S. Treasury Bills | 122.84 | 64.2% |
| Precious Metals (gold bars, per BDO note) | 19.08 | 10.0% |
| Secured Loans | 14.18 | 7.4% |
| Overnight Reverse Repurchase Agreements | 9.52 | 5.0% |
| Bitcoin | 8.37 | 4.4% |
| Term Reverse Repurchase Agreements | 7.18 | 3.7% |
| Other Investments | 6.00 | 3.1% |
| Public Equities | 4.18 | 2.2% |
| Corporate Bonds, Non-US Treasury Bills, Cash & Bank Deposits | 0.11 | 0.1% |
| Total Assets | 191.45 | 100% |
BDO ISAE 3000R report, Tether Financial Figures and Reserves Report as of Sept. 30, 2026 [2]. Shares are Le Coin's math; they may not sum exactly because of rounding.
Directly held T-bills come to 64.2% of total assets. That is Le Coin's math: $122.84 billion of U.S. Treasury Bills divided by $191.45 billion of total assets. Adding the $9.52 billion of overnight reverse repo takes the share to 69.1%, also Le Coin's math from the same two report lines. Tether's release uses a third figure: "Direct and indirect holdings of U.S. Treasury bills total $132.4 billion" [1]. That number is Tether's own and does not appear as a line in BDO's table.
The report values bitcoin at $83,621.23 per coin and gold at $4,157.41 per ounce, both Bloomberg closing prices on Sept. 30 [2]. More than a quarter of the reserves, 27% by Le Coin's math across gold, bitcoin, secured loans, equities and other investments, can move with markets or depend on borrowers.
The buffer grew in the quarter. Tether's release says excess reserves were "nearly doubling to $7.95 billion from $4.1 billion at the end of Q2" [1], and its Q2 release gave the June 30 figure as $4.11 billion [3]. The BDO report confirms the Sept. 30 number: assets exceed liabilities "by US$ 7,954,630,470" [2].
| Quarter-end | US$ bn | Source |
|---|---|---|
| June 30, 2026 | 4.11 | Tether Q2 release [3] |
| Sept. 30, 2026 | 7.95 | BDO report [2]; Tether Q3 release [1] |
Tether [1][3]; BDO [2]. Exact figures: US$4,109,529,196 and US$7,954,630,470.
Tether CEO Paolo Ardoino said in the release: "Generating $1.5 billion in net operating profit while maintaining nearly $8.0 billion in excess reserves gives us a strong foundation for that work" [1].
What the report does not cover
BDO did the work as a reasonable-assurance engagement under ISAE 3000R, an international assurance standard. Its opinion is "limited solely to the Financials Figures and Reserves Report and the corresponding total assets and total liabilities as of 30 September 2026," and "activity prior to and after this time and date was not considered" [2]. The notes to the report carry the line "(no assurance provided by the independent auditor on these notes)" [2].
The profit measure is where this matters. The phrase "net operating profit" does not appear in BDO's report. What does appear is a change-in-equity table that shows a nine-month "Financial result" of $1,660 million, alongside net capital movements of minus $519 million [2]. Tether's release reports nine-month net operating profit of $4.5 billion [1]. The two are different measures. Tether does not define net operating profit, and neither document explains how one relates to the other.
The report also notes one class action against the company in the courts of New York, "alleging a variety of claims relating to the drop in the price of bitcoin in 2017 and 2018." No provision is recognized for it [2].
The tell (Le Coin's view)
The figure to watch is the share of reserves in T-bills and repo, because that is what pays for the profit. At 69.1%, Tether's income mainly reflects short-term U.S. rates. If that share holds, the income it produces moves with short-term yields, by the mechanism above. If the share falls while the gold, bitcoin and loan lines grow, then the earnings and the buffer depend more on market prices than on the coupon. The next report will show which way it went. In Le Coin's view, the buffer number deserves more weight than the headline profit, because the buffer is the one an outside firm checked.
Stop
As of Sept. 30, BDO's report shows Tether with $191.45 billion of assets, $122.8 billion of it in directly held T-bills, and $7.95 billion more in assets than liabilities. The $1.5 billion quarterly profit is Tether's claim, and BDO did not attest to it.
Sources
- Tether, "Tether Generates $1.5 Billion in Q3 Net Operating Profit as Reserve Buffer Doubles to Almost $8 Billion," Oct. 30, 2026: https://tether.io/news/tether-generates-1-5-billion-in-q3-net-operating-profit-as-reserve-buffer-doubles-to-almost-8-billion/
- BDO Advisory Services, "Assurance Report according to ISAE 3000R on the Financials Figures and Reserves Report," Tether International, S.A. de C.V., as at Sept. 30, 2026, signed Milan, Oct. 30, 2026: https://assets.ctfassets.net/vyse88cgwfbl/7nQYtcoP9GxIUFSyro2dGK/8d0521470b9e99c8c0831019cabea4ee/ISAE_3000R_-_Opinion_Tether_International_Financial_Figure_30-09-2026.pdf
- Tether, Q2 2026 results release, July 31, 2026: https://tether.io/news/tether-posts-strong-q2-performance-generates-1-5b-net-operating-profit-maintains-4-11b-reserve-buffer-and-expands-gold-holdings-to-more-than-146-tons/
Holding the Corner.
Not financial advice.