Tether approaches a $500 billion valuation: The capital game and narrative ambition behind the "crypto central bank"

Original Title: "Is the 'End Time' Coming for Traditional Banks? Tether's $500 Billion Valuation Rivals OpenAI!"

Source: BitpushNews

A recent fundraising news from stablecoin giant Tether is enough to make the entire traditional financial sector hold its breath.

According to Bloomberg, this "central bank of the crypto world," which manages nearly $173 billion in USDT, is seeking a massive private fundraising round of $15-20 billion at a valuation as high as $500 billion.

What does this number mean? It means that Tether's scale will directly rival global top tech unicorns like OpenAI and SpaceX, and its staggering $4.9 billion quarterly net profit puts many established financial institutions to shame. This is not just fundraising—it's a value declaration from a "hidden giant whale" rising from the crypto world, formally challenging the traditional financial system.

$500 Billion Valuation: A Bold Numbers Game

Tether dares to propose such a bold valuation, thanks to its unshakable core advantages:

· Absolute Market Dominance: With a market cap of about $172.8 billion, Tether's USDT firmly holds the top spot in the stablecoin market and is the de facto settlement currency of the crypto world. Its daily trading volume easily surpasses tens of billions of dollars, forming the deepest liquidity moat.

· Astonishing Profitability: In Q2 2025, Tether reported $4.9 billion in net profit, with reserve assets reaching $162.5 billion, exceeding its $157.1 billion in liabilities, demonstrating robust financial health. Most of this massive profit comes from its holdings in high-yield U.S. Treasury bonds.

Behind the Frenzy: A Zero-Sum Game

Although Tether stands out with its scale and profitability, competition in the stablecoin sector is fiercer than ever. Analysts at JPMorgan point out that the total market cap of stablecoins grows in tandem with the overall crypto market cap, indicating a "zero-sum game"—issuers' main task is to fight for market share, not to expand the entire pie.

This "arms race" is unfolding on multiple fronts, with challengers trying to carve out a share from the dominance of Tether and Circle.

Tether's Own Strategic Adjustment: USAT Compliance Counterattack

To address regulatory and challenger threats, Tether is making strategic adjustments. It plans to launch a new stablecoin called USAT, aiming for full compliance with the recently passed U.S. "GENIUS Act." This differs from Tether's existing USDT, of which about 80% of reserves meet the Act's requirements.

· Anchoring Compliance: USAT's reserves will be custodied by institutions like Anchorage Digital, which holds a banking license. This helps Tether build institutional trust, reduce reliance on third-party banks, and avoid risks similar to what Circle experienced during the 2023 Silicon Valley Bank crisis.

· Key Personnel Onboard: Tether has appointed Bo Hines, Executive Director of Trump's "Digital Asset Advisory Board," as CEO of its U.S. operations. Hines was a key figure in the Trump administration's crypto policy, helping to push through the GENIUS Act, which provides a new regulatory framework for stablecoins—directly related to Tether's plan to launch the compliant stablecoin USAT.

· Close Ties with Trump Allies: Tether's main reserve asset custodian is Cantor Fitzgerald, whose former CEO Howard Lutnick is the current U.S. Secretary of Commerce. This endorsement at the highest political level gives Tether a huge trust advantage in expanding its U.S. market.

· Profit Maximization: By directly managing USAT's reserves, Tether aims to retain more interest income, thereby increasing profit margins and further strengthening its business model.

These moves show that Tether is shifting from a "regulatory avoidance" strategy to one of "actively embracing" and even "shaping" regulation. If Tether can successfully operate under U.S. regulation, it will not only eliminate its biggest valuation obstacle but also gain significant credibility, attracting a broader range of institutional capital.

Actions of Other Competitors

Facing multiple challenges, Tether's main competitor Circle is not sitting idly by. It is building a dedicated stablecoin blockchain called Arc, aiming to firmly anchor USDC at the center of the crypto ecosystem by optimizing speed, security, and interoperability. Payment giants like Visa have already partnered with Circle to explore using USDC for merchant payments on blockchains such as Solana.

Fintech giants have also seen the huge potential of the stablecoin market and are entering the fray. Companies like Robinhood and Revolut are reportedly developing their own stablecoins, aiming to leverage their massive user bases and mature financial infrastructure to directly challenge existing stablecoin issuers.

The decentralized finance (DeFi) sector is also launching a challenge against stablecoin hegemony. As one of the most popular DeFi protocols, Hyperliquid is preparing to launch its native stablecoin USDH to break free from reliance on Circle's USDC. J.P. Morgan analysts point out that Hyperliquid's perpetual contract exchange currently accounts for 7.5% of total USDC usage. Once USDH successfully launches and establishes liquidity, this market share could shift directly from USDC, posing a significant threat to Circle.

Conclusion: A Bold Gamble or a New Financial Giant?

When Tether, with a $500 billion valuation, stands shoulder to shoulder with AI giant OpenAI, what we see is not just the rise of a single company, but a revolution in the financial paradigm. The intermediary model that traditional banks rely on for survival is being completely upended by the global instant settlement capabilities of stablecoins.

This is no longer simple competition, but a dimensionality reduction blow. Tether, with its actual valuation, is declaring to the world: the future of finance does not belong to banks made of steel and concrete, but to global liquidity networks built with code. Banking services no longer need branches—just a crypto wallet.

Just as the internet enabled the free flow of information, stablecoins represented by Tether are enabling the free flow of value. When financial infrastructure becomes as simple as sending an email, how much room is left for traditional banks to survive? The answer may be hidden in Tether's astonishing valuation.

This silent financial revolution has already arrived—not in the future, but in the present continuous tense.