The argument is that if a USD-backed token were absent, crypto as a whole would be worth far less than the $2.8 trillion it is currently valued at. Without a fluid, highly liquid, multi-chain stablecoin like USDT (Tether), trading and holding crypto would be extremely difficult.
No one would be willing to risk holding an extremely volatile crypto asset that can move over 10% in a day. Institutions would play it safe, and though the appeal of crypto remains, they would likely double down on solid and relatively stable alternatives like gold—or even more so, US Treasuries.
Tether Holds $33 Billion of US Treasuries
From this analysis, it’s easy to see that USDT, the first stablecoin, is a game-changer and will continue to be so, driving the demand of some of the best cryptos to buy in 2025.
News that Tether, the issuer of USDT, bought $33 billion of US Treasuries in 2024 is not only massively bullish but also expected from the firm. At this level, Tether is the world’s seventh-largest buyer of US bonds, holding more debt than Norway, Hong Kong, and South Korea.
In a post on X, Paolo Ardoino, the CEO of Tether, said in 2024, Tether trailed the Cayman Islands, which bought over $100 billion of US debt, as well as France, Luxembourg, Singapore, and the UK. During this period, it’s worth noting that India, Ireland, Brazil, Japan, and Mainland China offloaded billions of US Treasuries.
Tether issues a stablecoin, USDT, on multiple chains like Ethereum and Tron. Each token, of which there are over $143 billion in circulation as of March 21, 2025, is pegged to the USD. USDT tracks every USD move, and the greenback’s volatility reflects on USDT on-chain.
Being a token issuer of a coin tracking the USD means Tether must secure exposure to highly liquid collateral like Treasuries. But why is Tether making such a bold move and rapidly accumulating Treasuries?
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A Strategic Move for Stability and Compliance
By holding $33 billion in Treasuries, Tether earns a decent yield—currently within the 4.25% to 4.50% range—explaining its $13 billion profit in 2024. However, the objective seems to be far more than just financial gain.
Ardoino and his team are being strategic, aiming not only to strengthen their market position but also to comply with the law.
As the unofficial “distribution network” delivering USD to over 400 million people in emerging markets, as the Tether CEO claims, its role in driving USD dominance is clear.
Beyond this, their actions align with proposed stablecoin regulations in the United States, particularly the GENIUS Act.
Yesterday, President Trump urged Congress to pass all pending stablecoin regulations, stating, “Dollar-backed stablecoins will expand the dominance of the U.S. dollar for years to come.”
The more stablecoins tracking the USD, the more supreme the greenback becomes in international markets, and thus, more capital moving into some of the hottest presales to buy right now.
Under the GENIUS Act, stablecoin issuers would be required to hold U.S. debt as collateral backing all tokens in circulation.
By preemptively purchasing billions in U.S. debt, Tether is positioning itself to comply with potential future regulations while solidifying its foothold in the American financial system.
However, while their decision to accumulate Treasuries is evident, Tether has historically resisted third-party audits—a key requirement for compliance under the GENIUS Act.
Tether Preparing For A Full Financial Audit
In an attempt to move past this tainted history and possibly usher in a new era of transparency, Tether hired Simon McWilliams as its CFO before a full audit is conducted. The stablecoin issuer called this “a crucial step in raising industry standards and strengthening regulatory engagement.”
An audit is critical now that banks are eyeing the stablecoin market and Ripple’s RLUSD is making strides. RLUSD, which targets institutions only, complies with New York financial laws.
This just in…we have final approval from @NYDFS for $RLUSD! Exchange and partner listings will be live soon – and reminder: when RLUSD is live, you’ll hear it from @Ripple first.
— Brad Garlinghouse (@bgarlinghouse) December 10, 2024
If Tether fails to comply with US laws, it could be outpaced by the more compliant USDC, which remains one of the fastest-growing stablecoins, especially in the United States and Europe.
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Tether Bought $33 Billion of Treasuries In 2024: Will It Comply With the GENIUS Act?
- Market Impact: Tether bought $33 billion of U.S. Treasuries in 2024. USDT fuels the $2.8 trillion crypto market and is the largest stablecoin by market cap
- Regulatory Play: Preemptive debt buys position Tether for GENIUS Act compliance, despite audit resistance
- Competition: RLUSD and USDC threaten USDT’s dominance if it falters on U.S. law alignment
The post The Secret Reason Tether Is Buying Billions in Bonds: Paolo Ardoino Reveals Tether Is 7th Largest Buyer appeared first on 99Bitcoins.
