In a landscape increasingly characterized by volatility and uncertainty, Tether, the largest stablecoin by market capitalization, finds itself at the center of yet another intense debate over its financial health. Arthur Hayes, the co-founder of BitMEX, has expressed alarm over Tether’s recent strategic pivot towards Bitcoin and gold, suggesting that such a shift could expose the stablecoin to significant risks in the event of a market downturn.
Hayes postulated that a drop of approximately 30% in Tether’s holdings of these assets could potentially obliterate the company’s equity, putting USDT in jeopardy. This warning has ignited discussions about the transparency and strength of Tether’s underlying financial structure.
The Tether folks are in the early innings of running a massive interest rate trade. How I read this audit is they think the Fed will cut rates which crushes their interest income. In response, they are buying gold and $BTC that should in theory moon as the price of money falls.… pic.twitter.com/ZGhQRP4SVF
— Arthur Hayes (@CryptoHayes) November 29, 2025
Tether’s Strength: A Rebuttal from a Former Citi Analyst
In stark contrast to Hayes’s apprehensions, a former research lead from Citi, known as “Joseph,” has stepped forward to challenge the narrative. He argues that the public attestations made by Tether only reflect the assets that directly back the existing USDT supply and fail to account for the entire spectrum of corporate assets.
I spent 100’s of hours writing research on tether for @Citi. @CryptoHayes missed a few key points.
1) 𝐓𝐡𝐞𝐢𝐫 𝐝𝐢𝐬𝐜𝐥𝐨𝐬𝐞𝐝 𝐚𝐬𝐬𝐞𝐭𝐬 =/ 𝐚𝐥𝐥 𝐜𝐨𝐫𝐩𝐨𝐫𝐚𝐭𝐞 𝐚𝐬𝐬𝐞𝐭𝐬
When tether generates $ they have a separate equity balance sheet which they don’t… https://t.co/pHSRr245Up
— Joseph (@JosephA140) November 30, 2025
Joseph asserts that his extensive research indicates Tether’s total equity could range between $50 billion and $100 billion—much more substantial than critics often recognize when they focus solely on attested reserves.
Reported Buffers in Tether’s Balance Sheet
According to his analysis, Tether reportedly holds around $120 billion in US Treasuries, generating nearly 4% returns, which could translate into around $10 billion annually in net income. Distinct from the public reserve figures, Joseph also highlighted various corporate assets—equity stakes, mining operations, and additional Bitcoin holdings—which collectively enhance Tether’s capital position.
Tether’s CEO, Paolo Ardoino, reinforced this perspective by mentioning a substantial “group equity” buffer amounting to approximately $30 billion, providing a financial cushion against adverse market conditions.
re: Tether FUD
From latest attestation announcement (Q3 2025):
“Tether will continue to maintain a multi-billion-dollar excess reserve buffer and an overall proprietary Group equity approaching $30 billion.”
Tether had (at end of Q3 2025) ~7B in excess equity (on top of the…
— Paolo Ardoino (@paoloardoino) November 30, 2025
Despite the reassurances, Hayes’s cautionary note persists. He emphasizes that the volatility of assets such as Bitcoin and gold can pose immediate threats to reserve valuations. While acknowledging Tether’s shift as a potential macro hedge amid anticipated interest rate cuts, he warns that a market crash could leave it vulnerable.
What’s evident from this discourse is twofold. First, there are substantial figures on the table—estimated assets reaching $120 billion and diverse equity estimates ranging from $30 billion to over $100 billion. Secondly, the core issue lies in the disclosure of Tether’s comprehensive financial health. The capacity to mobilize broader holdings during market stress could dictate Tether’s ability to weather volatility effectively.
Featured image from Pexels, chart from TradingView
