Tether's annual profit may reach $15 billion: Analysis of the reshaping of USDT liquidity landscape

Key Points

Tether projects net profit of $15 billion in 2025, a 15% increase from $13 billion in 2024, primarily driven by USDT issuance growing to $183 billion and a stratospheric 99% profit margin. Despite continued expansion in absolute terms, USDT's market share declined from 70% at the end of 2024 to 60% in October 2025, primarily due to the EU's MiCA regulations. The liquidity landscape is reshaping: CEXs still dominate (accounting for 80-90% of trading volume), but DEXs' share has increased from 5% to 15%. Cross-chain distribution is shifting toward Ethereum (55%), while Tron remains stable (42%). Rising institutional adoption and regulatory compliance demands are driving the rise of competing products like USDC.

Tether's profit model and $15 billion goal

Income structure analysis

Tether's core profitability comes from the yield on its $127 billion U.S. Treasury bond portfolio . According to Q2 2025 data, the company's net profit was $4.9 billion (US$5.7 billion in the first half of the year). Its main revenue sources include:

Tether's 99% profit margin stems from its extremely low operating costs and passive income model. The company invests the fiat currency deposited by users in low-risk, high-yield assets, and the interest income is directly converted into profits.

Optimization of reserve fund composition

As of Q2 2025, Tether's reserves were $162.6 billion, exceeding its liabilities by $157.1 billion, resulting in $5.5 billion in excess reserves:

• U.S. Treasury bonds/equivalents : 78% ($127 billion)
• Gold reserves : 4% ($6.5 billion)
• Bitcoin : 5% ($7.6 billion)
• Secured loans and other : 8% ($13.2 billion, tapering off)
• Cash and equivalents : <1% ($64 million)

This allocation strategy maximizes returns in a high-interest rate environment while maintaining sufficient liquidity to support USDT anchoring.

USDT market position and liquidity landscape changes

Market share evolution

Although USDT's absolute size continues to grow, its market share is being diluted:

USDT's daily trading volume reached $90.5 billion (October 2025), and its monthly trading volume peaked at $1.01 trillion (June 2025), but its market share declined mainly due to regulatory pressure .

Reshaping cross-chain distribution

USDT's multi-chain layout has changed significantly:

• Ethereum : increased from 35% to 55% ($99.9 billion), benefiting from L2 expansion and institutional interest
• Tron : Maintains 42% ($77.5 billion), maintaining its low-cost advantage in emerging markets
• Solana : Fluctuated significantly, down from 8% in Q2 to 1.3% currently ($2.4 billion)
• Other chains : Emerging chains such as Aptos grew 8 times to $750 million

Deep improvement in liquidity

1% of global USDT trading depth is approximately $200 million (a 50% year-on-year increase):

• CEX liquidity : Binance BTC/USDT pair depth is approximately $20 million (buy) / $18 million (sell)
• DEX liquidity : Uniswap ETH/USDT pair depth is $2-5 million, a 150% increase over last year
• Regional differences : MiCA regulations lead to a 10% decrease in EU liquidity, but a 20% increase in Asia/emerging markets

Regulatory impact and competitive landscape

Impact of MiCA regulations

The EU MiCA regulation (effective June/December 2024) requires stablecoins to comply, resulting in:

• USDT is delisted from EU exchanges (e.g. Binance and OKX restrict trading for EU users)
• EU USDT trading volume drops 10-15%
• USDC's market share in the EU has increased by 79% due to its regulatory compliance advantages.

Tether launched compliant products through its subsidiary StablR/Quantoz and plans to launch USAT in December 2025 to respond to the US GENIUS Act.

Rise of competitors

USDC is growing rapidly due to its transparency and compliance advantages:

• Market capitalization growth : From $24.2 billion at the beginning of 2024 to $76.3 billion (+215%)
• Institutional preference : BlackRock, Fidelity, etc. prefer USDC for compliant investment
• Technical advantages : monthly audits, better DeFi integration

Emerging stablecoins such as Ethena’s USDe (up 177.8% to $10.7 billion) are also eroding market share.

Community sentiment and market confidence

Positive perspective

Influencers are generally optimistic about the sustainability of Tether’s business model:

• Paolo Ardoino (Tether CEO) emphasizes long-term sustainability through excess reserves, Bitcoin allocation, and programmability x.com
• Anthony Pompliano believes Tether has strategic value in the global dollarization process and countering the BRICS challenge
• Jamie Coutts sees USDT as a systemic asset tied to US debt and Bitcoin

Questioning voices

Some analysts expressed concerns about transparency:

• Bitfinexed criticized Tether for deliberately circumventing regulatory scrutiny by refusing a full audit .
• Christopher Bloomstran questions the rationale for equity financing at a 99% profit margin .
• The Fed's warning on "risk assets" has exacerbated market distrust

Market Outlook and Conclusion

Growth drivers

1. Interest rate environment : U.S. Treasury yields remain high, providing a stable source of income for Tether
2. Emerging market demand : USDT continues to grow in cross-border payments and inflation hedging
3. Institutional adoption : Digital asset allocations increased from 1% to 2-5%, driving demand for stablecoins
4. Technological innovation : multi-chain deployment, AI integration, and other expansion of application scenarios

Potential risks

1. Regulatory uncertainty : The US GENIUS Act, the EU MiCA, and other factors may further restrict the use of USDT
2. Competition intensifies : USDC and other compliant stablecoins erode market share
3. Transparency concerns : Lack of complete audits could trigger regulatory enforcement or a potential delisting panic
4. Interest rate risk : Central bank rate cuts could compress yields

Tether's $15 billion profit forecast reflects its dominant position in the global digital dollar ecosystem, but regulatory compliance and transparency will be key factors in determining its long-term competitiveness. USDT's liquidity landscape is evolving towards multi-chain, institutionalization, and regulatory compliance. While USDT will maintain its market leadership in the short term, its market share may be further diluted.