The $127 Billion Secret: How a Crypto Company Became America’s 18th-Largest Government Debt Holder
What if the biggest threat to traditional banking isn’t Bitcoin or CBDCs, but a stablecoin company that’s become America’s 18th-largest government debt holder? Tether Holdings just proved that private digital money can actually strengthen rather than weaken dollar dominance (and Wall Street’s elite are betting $500 billion they’re right about the future of global finance).
Seven years ago, Tether was on the brink of collapse. In October 2018, the stablecoin that promised to maintain a $1.00 peg briefly crashed to $0.88, sparking panic across cryptocurrency markets as traders questioned whether the company actually held sufficient dollar reserves to back its tokens. Federal prosecutors had launched a criminal investigation into whether Tether was being used to manipulate Bitcoin prices, while the Commodity Futures Trading Commission later found that Tether held adequate reserves for only 27.6% of days during a 26-month period from 2016 through 2018. The company’s relationship with its auditors had dissolved, leaving transparency claims in tatters, and academic researchers published papers alleging systematic market manipulation.
Today, that same company is negotiating to raise $20 billion at a $500 billion valuation.
Tether Holdings, the company behind the world’s largest stablecoin USDT, is in discussions for private funding that would place it among the most valuable private companies globally, rivaling OpenAI’s similar target, according to Bloomberg and Financial Times reports. The dramatic transformation from potential failure to unprecedented valuation represents one of the most remarkable corporate turnarounds in financial history.
The funding round represents a dramatic shift for Tether, which generated $13.7 billion in net profit in 2024, primarily from interest earned on its massive Treasury holdings that back the stablecoin.
Treasury Holdings Rival Nation States
Tether’s financial position has grown to rival sovereign governments. The company holds $127 billion in U.S. Treasury securities, making it the 18th-largest holder globally ahead of countries including South Korea and Germany. In the second quarter of 2025 alone, Tether purchased …
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