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Finance
January 31, 2024

Tether’s Q4 Attestation: Reports $2.85 billion in Profit, Sets New Records in
Excess Reserves of Cash and Cash Equivalent Backing Token in Circulation

Today, Tether Holdings Limited (BVI) released its assurance opinion for the
fourth quarter of 2023, conducted by BDO, a globally renowned independent
auditing firm. This attestation reaffirms the accuracy of Tether’s Consolidated
Reserves Report (CRR) and provides a detailed breakdown of the assets held by
the Group as of December 31, 2023.

In terms of financial performance, the fourth quarter witnessed a
record-breaking net profit of $2.85 billion, of which ~$1 billion in net
operating profits (were primarily interests from US Treasuries) with the
remaining primarily from the appreciation of Gold and Bitcoin reserves. The
excess reserves registered an all-time high increase of $2.2 billion totalling
$5.4 billion, while the remaining $640 million was invested in various strategic
projects (such as mining, AI infrastructure, P2P telecommunications and others).
These are confirmed to remain outside of the consolidated reserves report within
a new segregated VC umbrella, so that such investments don’t and won’t have any
impact on the token reserves. At year end, the outstanding secured loans, which
are collateralized by highly liquid assets as confirmed in the BDO attestation,
are fully covered by the undistributed accumulated profits known as excess
reserves ($4.8 billion in secured loans versus $5.4 billion of excess reserves).

Tether is proud to announce that it has achieved its goal of removing the risk
of secured loans from the token reserves. While such secured loans are widely
overcollateralized, Tether accumulated enough excess reserves to cover the
entirety of the exposure. This is in response to the community’s past expressed
concerns about this part of the portfolio.

Net profit for 2023 for the Group is $6.2 billion, of which ~$4 billion
represented the net operating profits generated by US Treasuries, Reverse Repo
and Money market funds while  the rest was generated through the performance of
other asset classes.

Tether also continued to experience positive contributions from all asset
classes, notably in Gold, Bitcoin, and other investments. The Group achieved new
record highs in both direct and indirect ownership of US Treasuries, with $80.3
billion exposure (where indirect exposure is calculated including
overnight-reverse repos secured by US Treasuries, and money market funds
invested in US Treasuries).

In line with the commitment to transparency and stability, Tether issued tokens
backed by Cash and Cash Equivalent at an impressive 90%, emphasizing its
dedication to maintaining liquidity within the stablecoin ecosystem.

The Consolidated Reserves Report (CRR) reiterates Tether's strong financial
position, with consolidated assets surpassing consolidated liabilities.

The Management of the Company asserts the following as of 31 December 2023:

 * The Group’s consolidated total assets amount to at least US$ 97,020,394,556

 * The Group’s consolidated total liabilities amount to US$ 91,597,732,663 of
   which US$ 91,572,956,801 relate to digital tokens issued.

 * The Group’s consolidated assets exceed its consolidated liabilities.

 * Tether Group is not considering a part of its reserves backing the issued
   token the investments made into sustainable energy, Bitcoin mining, data, AI
   infrastructure,P2P telecommunications technology and other long term
   proprietary investments. During Q4 2023, investments made into these fields
   reached US$ $642’551’135 (USD 1’452’205’608 since beginning of the year).

The chart below shows that, as of 31 December 2023, Tether accumulated $5.4
billion in excess reserves, fully covering the outstanding ~$4.8 billion in
secured loans included in the USD₮ reserves.



The chart below shows the growth of US Treasuries and Cash and Cash Equivalent
versus total outstanding Tether Tokens.



Paolo Ardoino, CEO of Tether, emphasized, "Tether’s Q4 attestation underscores
our commitment to transparency, stability, and responsible financial management.
Achieving the highest percentage of reserves in Cash and Cash Equivalents
reflects our dedication to liquidity and stability. The substantial net profits
generated not only in the last quarter of the year but throughout the year,
amounting to $6.2 billion, showcases our financial strength. Furthermore, our
investments in sustainable energy, Bitcoin mining, data, AI infrastructure, and
P2P telecommunications technology illustrate our commitment to a more
sustainable and inclusive financial future."

For further details, please refer to the latest assurance opinion and the
Consolidated Reserves Report here.

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