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Tether Profits Could Eclipse Those of BlackRock in 2023: Analysts

2 mins
Updated by Kyle Baird
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In Brief

  • Tether's profits could reach $6 billion in 2023, surpassing BlackRock's forecasted $5.5 billion net income.
  • USDT's circulating supply increased by 25.7% this year, accounting for 7% of the entire crypto market cap.
  • Rival firm Circle's USDC supply fell by 36% due to regulatory exposure and losses from Silicon Valley Bank exposure.
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Stablecoin issuer Tether could become one of the most profitable companies in America this year. According to some analysts, its earnings could be even greater than those of asset manager BlackRock.

Crypto industry analysts have reacted to a Barron’s report on the rise of stablecoin issuer Tether. Its profits could reach $6 billion in 2023 due to the fact that USDT is backed by high-earning U.S. treasuries.

On June 22, Barron’s reported that stablecoin firm Tether is crushing the crypto competition. It behaves like a bank by investing people’s deposits in reserves such as Treasuries, earning 5%.

On June 25, Castle Island Ventures partner Nic Carter commented on the report along with ETF expert Nate Geraci.

“Tether is the most profitable business per employee on the planet,” he exclaimed before adding, “Don’t tell me brypto is good for nothin!”

$6 Billion Stablecoin Behemoth

Furthermore, the firm said its excess reserve surplus hit an all-time high of $2.44 billion in the first quarter. This includes $1.48 billion in net profit.

With an estimated $6 billion in profits predicted this year, the firm is a “financial giant,” the report noted.

“The firm could earn more than BlackRock this year, forecast to report $5.5 billion of net income.”

Furthermore, stablecoin issuer Tether would also be more profitable than the crypto exchange Coinbase. The firm has racked up losses and is expected to post a $564 million loss in 2023.

Find out more about stablecoins:
What is a Stablecoin and How do They Work?

Furthermore, demand for USDT stablecoins keeps growing. Since the beginning of the year, Tether’s circulating supply has increased by 25.7% to its current peak of $83 billion.

It has a massive market share of 64%, accounting for almost 7% of the entire crypto market cap.

Tether Stablecoin Gain is Circle’s Loss

The same cannot be said for rival firm Circle which has greater exposure to U.S. regulators and institutions. As a result, and losses due to Silicon Valley Bank exposure, USDC supply has plunged this year.

The USDC stablecoin supply has fallen by 36% or $16 billion since the beginning of the year. Its circulation is back to levels last seen in September 2021 at around $28.5 billion, giving it a market share of 22%.

Additionally, regulatory crackdowns have removed the third largest stablecoin, Binance USD, from markets, leaving only one major player.

Earlier this month, BeInCrypto reported that America’s war on crypto had altered the stablecoin ecosystem leaving just one major player. This is not ideal for decentralization, diversity, or investor protection.

Top crypto projects in the US | April 2024

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Martin Young
Martin Young is a seasoned cryptocurrency journalist and editor with over 7 years of experience covering the latest news and trends in the digital asset space. He is passionate about making complex blockchain, fintech, and macroeconomics concepts understandable for mainstream audiences.   Martin has been featured in top finance, technology, and crypto publications including BeInCrypto, CoinTelegraph, NewsBTC, FX Empire, and Asia Times. His articles provide an in-depth analysis of...
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