Tether's $500B Valuation: Compliance-Driven Expansion to Mainstream Finance

Tether Holdings SA, the issuer of the world’s largest stablecoin USDT, is reportedly in early-stage discussions with Japan’s SoftBank Group Corp. and Ark Investment Management LLC to raise up to $20 billion in a funding round that could value the company at $500 billion. This valuation, if realized, would place Tether among the most valuable private firms globally, surpassing the market capitalizations of many publicly traded companies. The fundraising, which would involve a 3% equity stake, underscores the growing institutional interest in stablecoins—a sector projected to grow to $4 trillion in market value under bullish scenarios, according to Citi analystsTether (USDT) Fundraising Interest Reportedly From Softbank, Ark …^[1].

Tether’s USDT, with a market capitalization of $173 billion, has been a dominant force in the stablecoin market, which has expanded 40% year-to-date to $287 billion. The firm’s profitability has surged due to its reserve investments, particularly in U.S. Treasuries, yielding $4.9 billion in profits for the second quarter of 2025. The company’s aggressive fundraising aligns with its strategy to expand into the U.S. market through a new token, USAT, designed to comply with the GENIUS Act, the first federal crypto law in the U.S. This move reflects Tether’s broader effort to secure regulatory legitimacy in key marketsSoftBank, Ark in Talks to Invest in Tether’s Major Funding Round^[2].

SoftBank and Ark Invest, both seasoned technology investors, bring significant credibility to the potential deal. SoftBank, led by Masayoshi Son, has a history of high-stakes bets in emerging tech, including a planned $30 billion investment in OpenAI. Ark, under Cathie Wood, has already invested in Circle Internet Financial, Tether’s primary competitor, which recently went public with a $300 stock price surge from its initial $30. Tether’s partnership with these firms could accelerate its integration into mainstream finance and technology ecosystems, leveraging their networks and expertiseHow Tether Plans for $500 Billion Fundraising and Possible IPO^[3].

The fundraising is being advised by Cantor Fitzgerald LP, an investment bank with a long-standing relationship with Howard Lutnick, the U.S. Commerce Secretary. This connection highlights Tether’s strategic efforts to navigate U.S. regulatory landscapes, a critical step for its expansion plans. The company’s chairman, Giancarlo Devasini, holds a roughly 47% stake, which would be valued at nearly $224 billion at the proposed $500 billion valuation. Such a valuation would also make Tether the largest private stablecoin issuer by market value, eclipsing Circle’s USDC, which holds $74 billion in market capitalizationSoftBank, Ark in Talks to Invest in Tether’s Major Funding Round^[4].

Analysts note that the timing of the fundraising aligns with broader market trends. The stablecoin sector’s growth is driven by demand for faster, cheaper cross-border transactions and the rise of tokenized assets. Tether’s expansion into the U.S. market through USAT, combined with its existing dominance in emerging economies, positions it to capture a significant share of this growth. However, challenges remain, including regulatory scrutiny over stablecoin use in illicit financing and the need for robust reserve transparency. Tether’s recent hires, including Bo Hines, a former White House crypto policy advisor, signal a strategic pivot toward regulatory complianceTether (USDT) Fundraising Interest Reportedly From Softbank, Ark …^[5].

The potential IPO of Tether, though not confirmed, is seen as a logical next step following the fundraising. A listing could provide further liquidity and visibility, mirroring Circle’s successful public offering earlier this year. For now, the focus remains on securing key investors and finalizing terms. Both SoftBank and Ark have declined to comment, but their involvement—should it materialize—would mark a pivotal moment for Tether’s evolution from a stablecoin issuer to a global financial infrastructure playerHow Tether Plans for $500 Billion Fundraising and Possible IPO^[6].