Key Takeaways
- Tether initially aimed to raise $15–20 billion in fresh capital while targeting a $500 billion valuation in 2025.
- A 23% drop in net profit to $10 billion, combined with rising investor caution, forced the firm to scale back its fundraising ambitions.
- The once-hyped fundraising quietly lost momentum and appears to have collapsed amid broader crypto market turmoil.
Tether, issuer of the world’s largest stablecoin USDT, announced in September 2025 plans to raise $15–20 billion via a private placement, aiming for a valuation near $500 billion.
By early 2026, these ambitious plans had faltered amid investor skepticism and market volatility.
Bitget
Bitunix
BTCC
Investors Back Away From Tether’s Massive Valuation
Tether’s fundraising target of $15–20 billion at a $500 billion valuation has collapsed.
Had it succeeded, Tether would have ranked among the most valuable private companies globally, comparable to SpaceX or OpenAI.
The company planned to sell roughly 3% of its equity to a select group of strategic investors, with proceeds intended to support expansion into AI, commodities trading, and energy infrastructure.
CEO Paolo Ardoino downplayed the original $15–20 billion target, calling it a “maximum” rather than a firm goal.
Investor reluctance, amplified by a $467 billion cryptocurrency market selloff and declining confidence in high-valuation tech and crypto firms, forced the company to reassess its expectations.
Tether is now testing market appetite for a potentially smaller raise while still aiming for the $500 billion valuation.
Critics argue this valuation is overly ambitious, given Tether’s reliance on stablecoin issuance rather than diversified revenue streams.
For context, such a valuation would surpass major financial institutions like Bank of America and make Tether’s Chairman Giancarlo Devasini one of the world’s wealthiest individuals, with an estimated net worth exceeding $200 billion.
To address investor concerns about liquidity and exit options, Tether is exploring alternative mechanisms, including tokenizing its stock and buybacks.
Profit Decline Raises Further Questions
Tether reported a 23% drop in its 2025 net profit to $10 billion, down from $13 billion the previous year.
This decline, revealed in late January 2026, is linked to accounting adjustments possibly related to fundraising, along with pressures from rising interest rates and reduced yields on Treasury-backed reserves.
Despite reserves growing to $193 billion, with $186 billion in USDT circulation, the profit dip has raised questions about the sustainability of Tether’s business model in a stressed economic environment.
Analysts note that the timing of this announcement amid fundraising discussions could further deter investors, highlighting vulnerabilities in a company already facing scrutiny over transparency and regulatory risks.
The decline in profits comes amid a market-wide downtrend with BTC trading more than 40% below its all-time high of $125,000 set in October last year.
While being a leading stablecoin issuer, the firm has been ramping up its expansion plans over the past year by investing in AI, data centers, tokenization, and more.
As of February 2026, the fundraising remains in early stages with no confirmed closures.
And any downsizing or failure to attract commitments could signal that the $500 billion mark is indeed too high amid current market dynamics.
This narrative shift underscores the quiet erosion of momentum for the fundraising, potentially leading to its effective collapse without a public announcement.
