Tether Eyes $20 Billion Funding as Citi Forecasts Stablecoin Surge to $4 Trillion by 2030

SoftBank, ARK discussions highlight institutional push as Citi revises stablecoin projections

TL;DR:

• Tether is weighing a $15–20 billion raise at a $500 billion valuation, with SoftBank and ARK reportedly in talks to participate.
• The issuer reported $4.9 billion net income in Q2 2025 and is expanding into energy, infrastructure, and media while preparing a U.S.-compliant token.
• Citi projects stablecoin issuance could reach $1.9 trillion in its base case, $4 trillion in a bull case by 2030, potentially powering $100–200 trillion in annual payments.

SoftBank Group and ARK Investment Management are reportedly in talks to participate in Tether’s upcoming funding round, a potential $15–20 billion raise that would value the stablecoin issuer at roughly $500 billion. Bloomberg first reported the discussions on September 26, citing sources familiar with the matter. Cantor Fitzgerald, whose chief executive Howard Lutnick also serves as U.S. Commerce Secretary, is advising on the raise. While Tether CEO Paolo Ardoino confirmed that the company is exploring capital raising with a select group of prominent investors, he did not disclose names or specific targets.

The proposed round, which would represent Tether’s largest external fundraising to date, comes as the firm seeks to expand its business model beyond its core stablecoin reserves. Ardoino has outlined plans to channel new capital into sectors including commodities, energy, infrastructure, and media. This diversification strategy builds on the windfall profits generated from U.S. Treasury holdings, as short-term yields remain elevated. Tether’s net income for Q2 2025 reached approximately $4.9 billion, a year-over-year increase of nearly 277%. Cumulative net income for the first half of 2025 totaled $5.7 billion, with circulating supply of USDT at about $174–175 billion, commanding 63% of the stablecoin market by late September.

The ownership structure is equally striking. Co-founder Giancarlo Devasini remains the largest shareholder, with Bloomberg estimates valuing his stake at $224 billion if the raise proceeds at the expected valuation. Tether has also brought on new political and regulatory expertise, appointing former Trump crypto advisor Bo Hines as Strategic Advisor for Digital Assets and U.S. Strategy. The company is preparing a U.S.-compliant stablecoin, branded USAT, designed to meet the requirements of the GENIUS Act. Analysts have noted this as a potential challenge to Circle, which has long positioned USDC as the regulated alternative.

The company’s footprint extends deep into sovereign debt markets. By Q1 2025, Tether held an estimated $98.5 billion in U.S. Treasury bills, equal to about 1.6% of the entire market, making it one of the largest non-sovereign buyers. Academic research has suggested that such holdings suppress short-term Treasury yields by roughly 24 basis points, translating to an estimated $15 billion in annual interest savings for the U.S. government. This level of influence over sovereign debt markets underscores the scale of Tether’s role, as stablecoins have grown into critical liquidity instruments across both decentralized finance and traditional financial markets.

Institutional forecasts are reinforcing the trajectory. Citi’s 2025 report “Stablecoins 2030” revises its projections upward, estimating issuance could reach $1.9 trillion by 2030 in its base case and $4 trillion in a bull case. With sufficient velocity, Citi projects stablecoins could power between $100 trillion and $200 trillion in annual transaction volume. The report highlights three core growth drivers: partial substitution of bank deposits, accounting for 45% of growth; continued expansion of crypto market issuance at 40%; and substitution for physical banknotes, especially overseas dollar holdings, making up the remaining 15%.

Despite the optimistic projections, Citi noted that institutional adoption remains limited. Its “maturity score” for stablecoin adoption by corporates sits at just 0.5 out of 10, underscoring hesitance from large-scale institutions. Yet the bank also framed 2025 as cryptocurrency’s “ChatGPT moment,” suggesting the inflection point for adoption may already be underway. Citi further expects tokenized bank deposits, or “bank tokens,” to potentially surpass stablecoins in transaction turnover by 2030, exceeding $100 trillion, as corporates gravitate toward regulatory comfort and integration with existing financial infrastructure.

Other financial institutions have expressed more caution. JPMorgan in July cut its forecast for stablecoin growth, projecting issuance may only reach $500 billion by 2028, citing still modest payments use—estimated at about $15 billion in actual settlement volume, or roughly 6% of overall demand. This divergence of forecasts underscores the uncertainty surrounding how fast the sector can scale from crypto-native adoption to global financial integration.

The stakes extend beyond the coin market cap of individual tokens. Tether’s planned raise signals an effort to cement its position not just as the largest stablecoin issuer by crypto price index, but as a financial entity with macroeconomic weight. Citi’s projections, meanwhile, present a vision of a payments landscape where stablecoins, bank tokens, and CBDCs co-exist, each serving distinct functions across consumer, institutional, and cross-border markets. For investors and regulators alike, the question is whether these developments represent an evolutionary step in financial infrastructure or a concentration of systemic risk within a handful of private issuers.

This article has been refined and enhanced by ChatGPT.