Tether CEO slams S&P over “weak” USDT rating

At the end of November, the debate around USDT’s risk profile flared up again.

Recently, rating agency S&P Global Ratings cut its stability assessment for the stablecoin to “weak.” Analysts argued that Tether’s reserves have become riskier as the share of bitcoin, gold, secured loans, and corporate bonds has grown. At the same time, the market still has very limited visibility into how exactly these reserves are managed and who Tether’s key counterparties are.

According to an S&P report, bitcoin now accounts for about 5.6% of the total amount of USDT in circulation. That is higher than the stated 3.9% “buffer” that is supposed to absorb potential drawdowns in volatile assets. If bitcoin and other risky instruments in the portfolio drop at the same time, a shortfall in backing for the stablecoin could theoretically emerge. Regulators are also concerned about restrictions on redeeming USDT directly with the issuer and the lack of a clear separation between client assets and the company’s own assets in the event of bankruptcy.

S&P assigned USDT a “5 (weak)” risk score, its lowest rating for stablecoins. In practice, that label means the token carries higher credit and market risk than many of its peers.

That decision triggered a sharp response from Tether’s leadership.

Tether CEO Paolo Ardoino publicly criticized the agency’s approach. In his view, traditional rating models were built for banks and legacy financial institutions with long histories and opaque reporting. Those frameworks do a poor job of capturing how crypto companies operate, what data they publish, and how fast their balance sheets can change. Ardoino also pointed out that the same models once supported high ratings for institutions that later ran into trouble or even collapsed.

Ardoino stressed that Tether sees itself as an “overcapitalized” company with enough reserves to redeem tokens even during periods of extreme volatility. He also reminded critics that since launch the issuer has minted roughly 184 billion USDT while keeping the peg to the dollar through banking glitches, exchange failures, and waves of market sell-offs.

Tether also emphasized that a significant portion of its reserves is still held in U.S. Treasuries and other highly liquid instruments. At the same time, the company is not abandoning diversification and has been investing in real-world assets for several years. Media reports previously noted that Tether has become one of the largest private holders of gold outside of central banks.

The clash with S&P has reignited the long-running debate over how to measure the resilience of stablecoins. Critics of Tether argue that the growing share of volatile assets in reserves makes USDT more vulnerable to market shocks and calls for tougher external oversight. The company, in contrast, insists that its model has already been tested by real-world crises, while traditional finance is simply not ready to accept a large player that operates by a different rulebook.