After details leaked this week of negotiations between Tether and potential investors over a $15-20 billion private placement, skeptics are asking why the company needs to raise any cash at all.
After all, it claims to hold over $105 billion in cash, money markets, and US Treasuries in its reserves.
According to Bloomberg, Tether is in negotiations with investors to raise funds in exchange for a 3% stake in Tether Holdings SA.
With this fundraise, it hopes to achieve a valuation of $500 billion, a deal that if closed, would rank it alongside companies like OpenAI and SpaceX.
Although some correctly pointed to the backing of the company’s large quantity of redeemable USDT stablecoins to explain most of that $105 billion worth of cash equivalents, Tether admits that it also owns $5.4 billion worth of excess assets exceeding the total value of all its issued stablecoins and tokens.
$5.4 billion in net equity
So, not only does Tether disclose over $105 billion in cash equivalents, it claims to own $5.4 billion worth of assets above and beyond any obligations of its redeemable tokens.
Believe it or not, the company also claims a 99% profit margin. It reported $4.9 billion in profit during its most recent fiscal quarter — mostly by investing its $162 billion worth of reserves in Treasuries, gold, bitcoin (BTC), and various startups.
Speculation as to why Tether wants more cash
The first reason as to why Tether might want more cash involves the courts.
As of June 30, 2025, Tether International, S.A. de C.V. is a defendant in two civil litigation proceedings. One of those lawsuits involves victims of Celsius who are upset with Tether’s involvement in Alex Mashinsky’s collapsed enterprise.
Although Mashinsky is currently imprisoned at Fort Dix FCI with a 2035 release date, victims are proceeding in court against Tether via Celsius’ bankruptcy estate.
The suit involves 39,000 or possibly as much as 57,428 BTC, potentially worth more than $6 billion at today’s price.
Tether’s fault or obligations, if any, are indeterminate as of publication time.
The core of Celsius’ complaint involves a margin call dispute. Celsius victims claim Tether improperly rushed a 10-hour contractual waiting period after its margin call to liquidate Celsius’ digital assets held as collateral, at allegedly below-average prices during a panic.
Read more: Scoop: Bitfinex, Tether shareholder Harborne is Nigel Farage’s top donor
No audit, need cash
Beyond any potential legal obligations, skeptics also note that Tether hasn’t conducted a full audit.
For years, skeptics have questioned the quality, sources, and encumbrances of the company’s stablecoin reserves. Historically, it repeatedly promised to conduct a formal audit yet never delivered on that promise.
Instead, it’s produced various snapshot attestations that verify the existence of assets in accounts — regardless of where they came from or what its encumbrances were during the days prior and afterward.
Further speculation regarding Tether’s motivations for its private placement include a guess that it anticipates a general decline in digital asset prices.
Others pointed out that investors might simply be interested in Tether’s prospects to displace its competitor Circle, or continue growing as a private enterprise.