Tether''s latest attestation puts the supply of its dollar token above $170 billion, with the company reporting direct and indirect US Treasury exposure in the neighborhood of $120 billion.
Numbers at that scale change the nature of the company. An issuer holding that much short-dated government paper is a participant in Treasury market plumbing, not merely a customer of it, and redemptions large enough to matter would be felt by dealers before they were felt by traders.
Tether''s regulatory position is more complicated than its balance sheet. USDT circulates overwhelmingly outside the United States and Europe, and the token was not built to the specifications either jurisdiction has since written. Rather than retrofit it, the company is issuing a separate US-compliant token, USA₮, with a federally chartered trust company acting as issuer.
That two-token strategy is a bet that the world will stay divided: a regulated dollar token for American institutions, an offshore one for the emerging-market users who make up most of the demand.
Critics have focused for years on the composition and audit standard of the reserves. The attestations are reviews rather than full audits, a distinction the company disputes the significance of and its skeptics do not.
For now, the market has voted with balances. Whatever regulators conclude, USDT remains the settlement asset of choice across most of the trading world.