Tether Enters 2025 with White House Support and Record Profits

Tether’s fortunes have shifted dramatically over the past year. Once under scrutiny for its financial practices and alleged misuse by criminal networks, the stablecoin giant now begins 2025 with influential allies and unprecedented financial success.

From Controversy to Profitability

2024 was not without its challenges for Tether. Law enforcement agencies voiced concerns over the use of Tether’s USDT in illicit activities, including money laundering and drug trafficking. Simultaneously, doubts persisted about whether Tether had sufficient reserves to back its $137 billion in circulating USDT tokens.

Despite these headwinds, Tether reported an astounding $5 billion in profits for the first half of 2024, largely derived from returns on its reserves. These profits reflect its growing financial influence and the lucrative yields of its investments, particularly US Treasury bonds.

A Key Ally in the White House

Tether’s trajectory has been bolstered by political developments. President-elect Donald Trump has nominated Howard Lutnick, a billionaire financier and major supporter of Trump’s campaign, as Secretary of Commerce. Lutnick’s firm, Cantor Fitzgerald, manages billions in US Treasury bonds—a key component of Tether’s reserves—and reportedly owns a 5% stake in the company.

Lutnick’s support of stablecoins as “fundamental for the US economy” positions him as a powerful advocate for Tether in the government. If confirmed by the Senate, Lutnick’s influence could pave the way for further integration of stablecoins into the US financial system.

Addressing Regulatory Concerns

Tether remains under scrutiny for its connections to illicit activities. In 2024, the US Treasury reported that Mexican cartels increasingly used cryptocurrencies like USDT to fund fentanyl production. Additionally, Venezuela’s state-run oil company turned to Tether to bypass sanctions. While Tether’s CEO Paolo Ardoino has denied any ongoing investigations, regulatory pressure looms.

To counteract these allegations, Tether claims to work closely with law enforcement and has frozen approximately 1,800 wallets linked to criminal activity since its inception. Ardoino emphasizes the company’s commitment to compliance and transparency.

Diversifying Investments

Tether has expanded its investment portfolio significantly, venturing beyond low-risk US Treasury bonds to include higher-risk assets. Notable investments in 2024 included:

• $100 million in an Argentinian dairy producer.
• $200 million in brain-interface technology.
• $775 million in Rumble, a YouTube competitor popular among right-wing audiences.

“They’re just trying to find profitable uses for the vast amount of money they have,” commented crypto analyst Noelle Acheson.

Trade Financing and Global Adoption

Tether’s foray into trade financing has also garnered attention. In November, USDT facilitated a $45 million crude oil deal between a commodity trader and an oil company. Ardoino predicts this trend will grow in 2025, as businesses in certain regions seek alternatives to traditional dollar-based transactions.

“We anticipate significant progress as the search for dollar alternatives intensifies and barriers to adoption are removed,” Ardoino said.

BitGalactic’s Commentary

Tether’s growing profitability and political support could signal a new era for stablecoins. However, the company’s controversial history and ongoing regulatory challenges underscore the fragility of its position.

At BitGalactic, we believe Tether’s success highlights the dual-edged nature of crypto innovation: the potential to revolutionize global finance versus the risk of misuse and regulatory backlash. As 2025 unfolds, Tether’s ability to balance these dynamics will determine whether it cements its role as a cornerstone of the digital economy or faces further scrutiny.