SoftBank, ARK Eye Stake in Massive Tether Fundraise: Report

At least two high-profile investment companies are reportedly vying to back stablecoin issuer Tether as it looks to sell roughly 3% of its equity — a move that underscores pent-up investor demand for one of the world’s most profitable companies.

According to Bloomberg, venture capital giants SoftBank Group and ARK Investment Management are among potential investors considering a combined investment of up to $20 billion in Tether. 

As Cointelegraph reported this week, if successful, the funding round could value the company at up to $500 billion, placing it among the world’s most valuable private enterprises.

For comparison, OpenAI, the developer behind ChatGPT, is said to be in talks to raise capital at a similar $500 billion valuation.

Tether CEO Paolo Ardoino confirmed earlier this week that the company is exploring a potential fundraise “from a select group of high-profile key investors,” though he declined to disclose specific names or amounts. 

Ardoino also hinted that Tether could expand into new business lines, including commodities, energy and media, as part of its broader growth strategy.

The investor interest reflects Tether’s dominant position in the stablecoin market, which has evolved from a tool for crypto traders into a strategic financial asset. In the United States, the recently approved GENIUS Act has further elevated stablecoins as a national priority, aimed at strengthening the dollar’s role in global finance.

Tether’s flagship US dollar-backed, USDt (USDT), remains the world’s largest stablecoin with a market capitalization of approximately $173.6 billion.

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Tether’s massive profitability and the need to move beyond interest income

Backed by vast US Treasury holdings and a growing Bitcoin (BTC) reserve, Tether has become one of crypto’s most profitable companies, reporting $4.9 billion in net income in the second quarter of 2025 — marking a 277% increase compared to one year earlier.

Tether’s core business model centers on issuing its USDt stablecoin. When users deposit fiat currency, Tether mints USDT and invests the corresponding reserves into yield-generating assets. 

The majority of these reserves are allocated to US Treasury bills, particularly short-term securities such as three-month and 12-month T-bills, which pay fixed interest and are considered virtually risk-free.

The surge in short-term Treasury yields since 2022, when the US Federal Reserve began its aggressive rate-hiking cycle, has significantly boosted Tether’s earnings. As the federal funds rate climbed above 5%, yields on three-month T-bills — among the most rate-sensitive maturities — rose in tandem, providing Tether with a powerful tailwind for interest income.

For major holders of short-duration Treasurys like Tether, this environment translated into record profits. Elevated rates have allowed the company to earn substantial returns on its reserves while maintaining high liquidity. 

However, while yields remain historically elevated, the three-month Treasury yield now sits below its peak levels from 2023 and 2024, potentially signaling a need for T-Bill-rich firms to reduce their reliance on interest income. 

In addition to interest income, Tether has also generated revenue from secured lending, issuing collateralized loans backed by its reserves — a line of business that has further contributed to its overall profitability.

Despite the overwhelming success of its core business model, Tether is actively seeking to diversify its operations. Based on comments from Ardoino, the company has begun expanding into new sectors — including a pivot toward infrastructure and energy production, first announced in late 2023.

In 2024, Tether made its first crypto venture capital investment, committing funds to support Arcanum Capital.

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