Tether Could Be Worth As Much As SpaceX Or OpenAI? Stablecoin Issuer Reportedly Eyes Sky-High $500B Valuation

Top stablecoin issuer Tether Holdings (USDT) is reportedly in discussions with investors to raise up to $20 billion, which could make it one of the world’s most valuable private companies.

According to a Bloomberg News report, the El Salvador-based firm is planning to raise between $15 billion and $20 billion in exchange for a roughly 3% stake through a private placement. The report stated that these are the top-end targets, and eventual numbers could be significantly lower. However, these talks are in their preliminary stages, and the details are subject to change.

The offering will involve new equity rather than existing investors selling their stakes, and Cantor Fitzgerald is acting as the lead adviser for the firm, the report added.

If the firm manages to raise the money at the discussed levels, it will put it in the league with tech giants OpenAI and SpaceX, according to the report. Circle, the U.S.-based stablecoin issuer, is currently valued at over $30 billion. According to the report, potential investors have been given access to a data room over the past few weeks to determine whether to participate in the new fundraising round. The deal is expected to close by the end of the year.

“Tether is evaluating a raise from a selected group of high-profile key investors, to maximize the scale of the Company’s strategy across all existing and new business lines,” CEO Paolo Ardoino said in a post on X.

Tether’s USDT token is pegged to the U.S. dollar, with a market value of about $172 billion. Circle’s USDC stablecoin is worth about $74 billion. The company reportedly logged $4.9 billion in profit during the second quarter, as per a company blog post. Ardoino had noted that Tether, which does not have to abide by the accounting principles for public firms, has a 99% profit margin.

Retail sentiment on Stocktwits about USDT was in the ‘bearish’ territory at the time of writing.

The firm is also looking to make a comeback in the U.S. amid a crypto-friendly environment in the world’s largest economy. In 2021, the company had to shell out $41 million to settle with regulators, who charged the firm with misrepresenting its reserves.

The U.S. has already passed a stablecoin act, and a growing number of firms have been adopting the digital asset, which offers instant transaction settlement between merchants and customers.

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