Tether Reserves and Attestations

Tether (USDT) is a prominent stablecoin in the cryptocurrency market, designed to maintain a one-to-one peg with the U.S. dollar. Issued by Tether International, S.A. de C.V., the stablecoin is backed by a diverse reserve portfolio, primarily consisting of U.S. Treasury bills, physical gold, and Bitcoin^[1]. As of 31 March 2026, Tether's reserves amounted to approximately $191.77 billion, with liabilities of $183.54 billion, resulting in a reserve buffer of $8.23 billion^[1]. The company regularly publishes attestations prepared by BDO, a global accounting firm, to confirm the accuracy of its reserve holdings^[1].

Tether's regulatory history includes significant scrutiny. In 2021, the New York Attorney General found that Tether's claims of full backing were false, leading to a settlement that mandated quarterly reserve disclosures^[4]. Additionally, the Commodity Futures Trading Commission (CFTC) found that Tether's reserves fully backed USDT on only 27.6% of days in a sampled period^[3]. Despite these challenges, Tether completed its first full financial statement audit for 2025, receiving an unqualified opinion from KPMG^[5]. However, questions about transparency and reserve composition continue to persist.

Overview

Tether's Financial Reporting

Tether, a prominent issuer of stablecoins, has historically provided transparency into its reserves through quarterly attestations. These attestations, conducted by BDO, a top-five global independent accounting firm, offer a snapshot of Tether's financial position at specific points in time. As of 31 March 2026, Tether's reserves were primarily composed of short-duration, high-quality liquid instruments, with significant exposure to U.S. Treasury bills amounting to approximately $141 billion^[1]. This exposure underscores Tether's strategy of maintaining liquidity and stability in its reserves.

In a significant development, Tether completed its inaugural financial statement audit for the year ended 31 December 2025^[1]. Conducted by KPMG US, this audit resulted in an unqualified opinion, indicating that Tether's financial statements present a fair view of its financial position in accordance with U.S. generally accepted accounting principles (GAAP)^[5]. This audit represents a milestone for Tether, marking the first time the company has subjected its financial statements to such comprehensive scrutiny by a Big Four accounting firm.

Historical Context and Regulatory Findings

Tether's reserve backing has been a subject of scrutiny and regulatory action. A notable finding by the U.S. Commodity Futures Trading Commission (CFTC) revealed that Tether's reserves fully backed its issued tokens on only 27.6% of the days in the sampled period^[3]. This historical fact highlights the challenges Tether has faced in maintaining transparency and trust regarding its reserve backing.

In response to regulatory pressures, including a settlement with the New York Attorney General (NYAG) in 2021, Tether has been required to provide quarterly reserve disclosures^[4]. This settlement addressed allegations that Tether had overstated its reserves and concealed significant financial losses. As part of the agreement, Tether paid $18.5 million in penalties and committed to enhancing its transparency practices^[4].

Quarterly Reserve Composition and Movements

Tether's reserve composition and financial position have evolved over recent quarters. As of 30 September 2025, Tether reported total reserves of $181.22 billion, with liabilities amounting to $174.45 billion, resulting in excess reserves of approximately $6.78 billion^[7]. By the end of the fourth quarter on 31 December 2025, Tether's reserves had increased to $192.88 billion, with liabilities of $186.54 billion, and excess reserves of $6.3 billion^[6]. This growth continued into the first quarter of 2026, with reserves reaching $191.77 billion, liabilities at $183.54 billion, and excess reserves climbing to a record $8.23 billion as of 31 March 2026^[1].

The table below summarizes the quarter-on-quarter movements in Tether's reserves and liabilities:

Date	Total Reserves (USD)	Total Liabilities (USD)	Excess Reserves (USD)
30 September 2025	$181.22 billion	$174.45 billion	$6.78 billion
31 December 2025	$192.88 billion	$186.54 billion	$6.3 billion
31 March 2026	$191.77 billion	$183.54 billion	$8.23 billion

These figures reflect Tether's ongoing efforts to maintain a robust reserve position, supported by its strategic allocation to U.S. Treasuries and other high-quality liquid assets. The increase in excess reserves over the quarters indicates a strengthening of Tether's financial buffer, enhancing its ability to meet redemption demands and maintain the stability of its stablecoin, USD₮.

What the reserves currently hold

Tether's reserves, as of the latest attestation on 31 March 2026, are primarily composed of U.S. Treasury bills, precious metals, and digital assets^[1]. The quarterly attestations, conducted by BDO, provide a snapshot of Tether's reserves at specific points in time, distinct from the annual financial statement audit conducted by KPMG^[5]. The following subsections detail the composition and changes in Tether's reserves over recent quarters.

Composition of Reserves

As of 31 March 2026, Tether's reserves were valued at approximately $191.77 billion, with liabilities amounting to $183.54 billion^[1]. The reserves included:

• U.S. Treasury Bills: Approximately $141 billion, representing the majority of Tether's reserve assets^[1].
• Precious Metals: Holdings of physical gold valued at approximately $20 billion^[1].
• Bitcoin: Approximately $7 billion in Bitcoin holdings^[1].

These assets are part of Tether's strategy to maintain liquidity and resilience, particularly through short-duration, high-quality liquid instruments^[1].

Quarter-on-Quarter Movements

The table below illustrates the changes in Tether's reserves and liabilities over the last three quarters:

Date	Total Assets (USD)	Total Liabilities (USD)	Excess Reserves (USD)	U.S. Treasury Exposure (USD)
30 September 2025	$181.22 billion	$174.45 billion	$6.78 billion	~$135 billion
31 December 2025	$192.88 billion	$186.54 billion	$6.3 billion	$141.6 billion
31 March 2026	$191.77 billion	$183.54 billion	$8.23 billion	$141 billion

• Q3 2025: As of 30 September 2025, Tether's reserves were $181.22 billion, with liabilities of $174.45 billion, resulting in excess reserves of $6.78 billion^[1]. The exposure to U.S. Treasuries was approximately $135 billion^[7].
• Q4 2025: By 31 December 2025, total assets increased to $192.88 billion, with liabilities at $186.54 billion, and excess reserves decreased slightly to $6.3 billion^[1]. U.S. Treasury exposure reached $141.6 billion^[6].
• Q1 2026: As of 31 March 2026, total assets slightly decreased to $191.77 billion, while liabilities decreased to $183.54 billion, resulting in a record excess reserve of $8.23 billion^[1]. U.S. Treasury exposure remained stable at approximately $141 billion^[1].

Historical Context

Historically, Tether's reserve backing has been a subject of scrutiny. The U.S. Commodity Futures Trading Commission (CFTC) found that Tether's reserves fully backed USDT on only 27.6% of the days in the sampled period^[3]. This historical finding underscores the importance of Tether's current transparency efforts, including the regular attestations and the recent full financial statement audit by KPMG^[5].

Attestation versus audit

Distinction Between Attestation and Audit

Tether's financial transparency involves two distinct types of financial scrutiny: attestations and audits. An attestation is a point-in-time report where an accounting firm, such as BDO, confirms that the figures provided by Tether's management align with the records on a specific date^[1]. In contrast, an audit is a comprehensive examination of financial statements over a period, providing an opinion on the overall financial health and operations of the company. This distinction is crucial for understanding the scope and depth of financial reporting provided by Tether.

Quarterly Attestations by BDO

BDO, a top-five global independent accounting firm, conducts Tether's quarterly attestations. These reports provide a snapshot of Tether's reserves and liabilities at the end of each quarter. For instance, as of 31 March 2026, Tether's reserves were primarily allocated to short-duration, high-quality liquid instruments, with direct and indirect exposure to U.S. Treasury bills amounting to approximately $141 billion^[1]. The total assets were reported at $191.77 billion, with liabilities of $183.54 billion, resulting in excess reserves of $8.23 billion^[1].

The quarterly attestations have shown a consistent pattern of reserve management. For example, as of 30 September 2025, Tether reported reserves of $181.22 billion with liabilities of $174.45 billion, resulting in excess reserves of $6.78 billion^[7]. By 31 December 2025, these figures had increased to $192.88 billion in reserves and $186.54 billion in liabilities, with excess reserves of $6.3 billion^[6]. This progression highlights Tether's strategy of maintaining a reserve buffer while managing liabilities.

Annual Audit by KPMG

On 13 August 2026, Tether announced the completion of its first full financial statement audit, conducted by KPMG US^[1]. This audit covered the financial year ending 31 December 2025 and resulted in an unqualified opinion, the most favorable outcome an independent auditor can issue^[5]. The audit was conducted under AICPA standards and involved a thorough examination of Tether's financial statements, including assets, liabilities, and cash flows. This audit represents a significant milestone for Tether, marking its commitment to transparency and financial scrutiny at a level comparable to major global companies.

Historical Context and Regulatory Findings

Historically, Tether's claims about its reserves have been scrutinized by regulators. The U.S. Commodity Futures Trading Commission (CFTC) found that Tether's reserves fully backed its USDT tokens on only 27.6% of the days in the sampled period^[3]. This finding underscores the importance of ongoing transparency and the role of both attestations and audits in providing assurance about Tether's financial practices.

Summary Table

Aspect	Attestation (BDO)	Audit (KPMG)
Frequency	Quarterly	Annually
Scope	Point-in-time report	Comprehensive financial statements
Latest Figures	As of 31 March 2026: $191.77bn assets, $183.54bn liabilities[1]	Year ended 31 December 2025[5]
Opinion Type	Confirmation of figures	Unqualified opinion
Regulatory Context	Historical scrutiny by CFTC[3]	Sets a new standard for transparency

This structured approach to financial reporting, combining both attestations and audits, reflects Tether's evolving commitment to transparency and accountability in the stablecoin market.

Attestation history

Overview of Attestations

Tether's reserve attestations are conducted quarterly by BDO, a top-five global independent accounting firm. These attestations provide a snapshot of Tether's financial position at specific points in time, confirming the assets backing the issued Tether tokens (USD₮). Unlike a full financial audit, which examines financial statements over a period, attestations focus on verifying the accuracy of figures at a given date^[1][6][7].

Historical Context and Regulatory Scrutiny

Historically, Tether's reserve claims have been subject to regulatory scrutiny. In 2021, the Commodity Futures Trading Commission (CFTC) found that Tether's reserves fully backed its issued tokens on only 27.6% of the days in the sampled period^[3]. This finding highlighted significant discrepancies in Tether's previous claims of one-to-one backing.

Recent Attestation Figures

The attestations from late 2025 to early 2026 illustrate Tether's financial evolution and reserve management:^[1]

Date	Total Assets (USD)	Total Liabilities (USD)	Excess Reserves (USD)	U.S. Treasury Exposure (USD)
30 September 2025	$181.22 billion	$174.45 billion	$6.78 billion	~$135 billion
31 December 2025	$192.88 billion	$186.54 billion	$6.3 billion	$141.6 billion
31 March 2026	$191.77 billion	$183.54 billion	$8.23 billion	$141 billion

As of 30 September 2025, Tether's reserves amounted to $181.22 billion, with liabilities of $174.45 billion, resulting in excess reserves of $6.78 billion^[7]. By the end of 2025, total assets increased to $192.88 billion, while liabilities rose to $186.54 billion, leading to a slight decrease in excess reserves to $6.3 billion^[6]. The first quarter of 2026 saw a further increase in excess reserves to $8.23 billion, with total assets at $191.77 billion and liabilities at $183.54 billion^[1].

Composition and Strategy

Throughout these periods, Tether's reserve strategy has emphasized holding high-quality, liquid assets, primarily U.S. Treasury bills. As of 31 March 2026, Tether's direct and indirect exposure to U.S. Treasuries was approximately $141 billion^[1]. This strategic focus on short-duration, government-backed instruments underscores Tether's commitment to maintaining liquidity and stability across varying market conditions.

Transition to Full Audits

In a significant development, Tether completed its inaugural full financial statement audit for the year ended 31 December 2025^[1]. Conducted by KPMG US, this audit resulted in an unqualified opinion, affirming the accuracy and transparency of Tether's financial statements under AICPA standards^[5]. This audit complements the ongoing quarterly attestations by BDO, providing a more comprehensive view of Tether's financial health and reserve management practices.

The combination of regular attestations and the newly introduced annual audit reflects Tether's efforts to enhance transparency and accountability in the stablecoin sector. This dual approach aims to address past criticisms and regulatory concerns while reinforcing confidence in Tether's reserve backing and financial integrity.

The 2021 findings on backing

Regulatory Scrutiny and Findings

In 2021, Tether faced significant regulatory scrutiny regarding its claims of one-to-one backing of its stablecoin, USD₮^[3]. The New York Attorney General (NYAG) conducted an investigation that concluded Tether's claims of full backing by U.S. dollars were false^[4]. This investigation revealed that Tether and its associated entities had misrepresented the reserves backing USD₮, leading to a settlement that required Tether to pay $18.5 million in penalties and mandated quarterly reserve disclosures^[4].

Additionally, the U.S. Commodity Futures Trading Commission (CFTC) found that Tether's reserves were fully backed on only 27.6% of the days during the sampled period^[3]. This finding was pivotal in highlighting discrepancies between Tether's public statements and its actual reserve practices. The CFTC's order required Tether to pay fines totaling $42.5 million, further emphasizing the regulatory pressure on the company to improve transparency and accuracy in its reserve reporting^[3].

Mandated Transparency Measures

Following the NYAG settlement, Tether was required to enhance its transparency measures significantly. This included the obligation to provide quarterly attestations of its reserves, which are point-in-time reports prepared by an independent accounting firm, BDO^[4]. These attestations aim to verify that the assets backing USD₮ align with the company's claims at specific dates, although they do not provide the comprehensive financial scrutiny that a full audit would entail.

Comparison of Reserve Composition Over Time

To understand the evolution of Tether's reserve composition, it is instructive to compare the figures from different quarters. As of 30 September 2025, Tether reported total reserves of $181.22 billion, with liabilities amounting to $174.45 billion, resulting in excess reserves of $6.78 billion^[7]. By 31 December 2025, these figures had increased, with total assets reaching $192.88 billion and liabilities at $186.54 billion, leading to excess reserves of $6.3 billion^[6]. As of 31 March 2026, Tether's reserves further increased to $191.77 billion, with liabilities of $183.54 billion, and excess reserves reaching a record $8.23 billion^[1].

Date	Total Reserves (USD)	Total Liabilities (USD)	Excess Reserves (USD)
30 September 2025	$181.22 billion	$174.45 billion	$6.78 billion
31 December 2025	$192.88 billion	$186.54 billion	$6.3 billion
31 March 2026	$191.77 billion	$183.54 billion	$8.23 billion

These figures illustrate Tether's efforts to maintain a reserve surplus, which is crucial for ensuring the stability and trustworthiness of USD₮. The increase in excess reserves over time reflects Tether's response to regulatory demands for greater transparency and financial robustness.

Conclusion

The findings from 2021 marked a turning point for Tether, compelling the company to adopt more rigorous transparency measures and improve its reserve management practices^[3]. The regulatory actions taken by the NYAG and CFTC underscored the importance of accurate reserve reporting, leading to ongoing quarterly attestations by BDO. These developments have been critical in shaping Tether's current reserve practices and its commitment to maintaining the stability of USD₮.

Reserve buffer and excess equity

Tether's reserve buffer and excess equity have been key components in maintaining the stability and trust in its USD₮ stablecoin. These elements are crucial for ensuring that Tether's liabilities are consistently backed by adequate reserves, providing confidence to users and regulators alike.

Quarterly Reserve Buffer Analysis

Tether's reserve buffer has shown significant growth over recent quarters, reflecting the company's strategy to maintain a robust financial position. As of 31 March 2026, Tether reported excess reserves of $8.23 billion^[1]. This figure represents an increase from the $6.3 billion in excess reserves reported as of 31 December 2025^[6], and a further increase from the $6.78 billion reported as of 30 September 2025^[7]. This upward trend in reserve buffer highlights Tether's commitment to overcollateralization, ensuring that its assets exceed its liabilities.

Comparative Reserve Buffer Table

Date	Total Assets (USD)	Total Liabilities (USD)	Excess Reserves (USD)
30 September 2025	$181.22 billion[7]	$174.45 billion[7]	$6.78 billion[7]
31 December 2025	$192.88 billion[6]	$186.54 billion[6]	$6.3 billion[6]
31 March 2026	$191.77 billion[1]	$183.54 billion[1]	$8.23 billion[1]

Excess Equity and Financial Health

The concept of excess equity is integral to understanding Tether's financial health. Excess equity, or the amount by which assets exceed liabilities, serves as a buffer against market volatility and potential financial disruptions. As of 31 March 2026, Tether's assets exceeded its liabilities by $8.23 billion^[1]. This excess equity not only provides a cushion against unforeseen market events but also reinforces Tether's ability to meet its obligations to token holders.

Historical Context and Regulatory Findings

Historically, Tether's reserve practices have come under scrutiny. A notable finding by the U.S. Commodity Futures Trading Commission (CFTC) revealed that Tether's reserves were fully backed on only 27.6% of the days in a sampled period^[3]. This finding has been a critical point in discussions about Tether's transparency and reserve management. However, recent attestations and the completion of a full financial statement audit by KPMG for the year ended 31 December 2025, which resulted in an unqualified opinion, indicate a shift towards greater transparency and accountability^[5].

Conclusion

Tether's reserve buffer and excess equity are vital indicators of its financial robustness. The consistent increase in excess reserves over recent quarters demonstrates Tether's proactive approach to maintaining a strong financial position. While historical regulatory findings have raised questions about Tether's reserve practices, recent developments, including regular attestations by BDO and a comprehensive audit by KPMG, suggest a commitment to transparency and financial integrity. These measures are essential for sustaining confidence in Tether's USD₮ stablecoin amidst a rapidly evolving digital asset landscape.

Open questions

Full Audit Transparency

While Tether has made strides in transparency by completing its first full financial statement audit for the year ended 31 December 2025, conducted by KPMG US, questions remain about the ongoing transparency of its reserves^[5]. The audit, which resulted in an unqualified opinion, marks a significant milestone for Tether, distinguishing it from the quarterly attestations performed by BDO^[5]. However, the audit covers only the financial statements for a specific period, and the quarterly attestations continue to provide point-in-time snapshots of Tether's reserves^[1][5]. The distinction between these two types of financial scrutiny raises questions about the frequency and depth of information available to stakeholders. While the audit provides a comprehensive review of the financial year, the attestations offer more frequent but less detailed insights. Stakeholders may question whether the current level of transparency is sufficient to fully understand Tether's financial health and reserve management practices.

Historical Backing Concerns

The Commodity Futures Trading Commission (CFTC) found that Tether's reserves fully backed its USDT tokens on only 27.6% of the days in the sampled period^[3]. This historical finding continues to cast a shadow over Tether's claims of one-to-one backing, despite recent efforts to improve transparency and reporting. The CFTC's finding is a critical point of reference for evaluating Tether's past practices and raises questions about the reliability of its current and future reserve disclosures. Although Tether has since taken steps to address these concerns, including the completion of a full audit, the historical context remains a point of contention for critics and regulators alike.

Reserve Composition and Movements

Tether's reserve composition and its movements over recent quarters also present open questions. As of 31 March 2026, Tether's reserves included approximately $141 billion in U.S. Treasury bills, $20 billion in physical gold, and $7 billion in Bitcoin^[1]. These figures reflect a strategy focused on liquidity and resilience, but they also prompt questions about the risk exposure associated with such allocations. Comparing the reserve figures from Q3 2025, Q4 2025, and Q1 2026 reveals significant movements:^[1]

Quarter	Total Assets (USD)	Total Liabilities (USD)	Excess Reserves (USD)	U.S. Treasury Exposure (USD)
Q3 2025[7]	$181.22 billion	$174.45 billion	$6.78 billion	~$135 billion
Q4 2025[6]	$192.88 billion	$186.54 billion	$6.3 billion	$141.6 billion
Q1 2026[1]	$191.77 billion	$183.54 billion	$8.23 billion	$141 billion

These figures illustrate fluctuations in Tether's reserves and liabilities, raising questions about the factors driving these changes and their implications for Tether's financial stability. The increase in excess reserves as of Q1 2026 suggests improved financial health, but the slight decrease in total assets compared to Q4 2025 may prompt inquiries into the underlying causes and future trends^[1]. Additionally, the consistent exposure to U.S. Treasuries underscores Tether's reliance on these instruments, which may be subject to market and regulatory risks.