Tether, the leading stablecoin provider, announced Wednesday that it generated $2.85 billion in net profit for the fourth quarter of 2023, “a record-breaking” level for the firm. 

According to Tether’s latest attestation report conducted by auditing firm BDO, the stablecoin issuer derived its profits primarily from interest earned on US Treasuries, as well as the appreciation of its gold and BTC reserves.

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Tether’s Q4 net profits, which made up nearly 46% of the firm’s total net profit of $6.2 billion in 2023, came as the market capitalization for Tether’s flagship product USDT increased more than 10% from $83.2 billion on Oct. 1 to $91.7 billion on Dec. 31, data from CoinGecko shows

At press time, USDT’s market capitalization stood at $96.7 billion, making it the third-largest cryptocurrency behind BTC and ETH and the biggest stablecoin in the crypto ecosystem. 

Excess Reserves

The report also noted that Tether’s total assets, which back the firm’s stablecoins, stand at $97 billion, while its liabilities amount to nearly $91.6 billion, as of the last day of December. Accordingly, Tether has about $5.4 billion of excess reserves.

Stablecoins are a type of cryptocurrency pegged to fiat currencies like the U.S. dollar in effort to provide price stability in crypto markets, known for its volatility.  

Read More: Tether, the Multibillion-Dollar Stablecoin at the Heart of the Crypto Ecosystem

Ryan Selkis, the founder of Messari Crypto, noted on X that Tether’s profits relative to its number of employees are extremely high compared to Wall Street heavyweight JPMorgan. Selkis wrote, “Tether’s net profits are now 10% of JPMorgan’s. Tether has ~50 employees, and JPM has 250,000.” 

Seraphim, the screen name for the head of growth at decentralized stablecoin protocol Ethena Labs quoted Selkis’ tweet and added, “To put it differently: profit per employee at JPM is $200,000 [while] profit per employee at Tether is $124,000,000. This is a perfect example of the efficiency of crypto tech vs dinosaur TradFi.”