Tether Engages KPMG for First Full Audit as Reserves Reach $193B and U.S. Stablecoin Rules Tighten

Stablecoin issuer formalizes Big Four oversight, expands U.S. footprint with USAT launch and institutional positioning

TL;DR

• Tether appoints KPMG for its first full audit, with PwC preparing internal systems ahead of review
• USDT supply stands near $185B with $193B in assets and over $6B in excess reserves
• U.S. regulation and USAT launch reshape Tether’s institutional strategy and compliance roadmap

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According to a report by the Financial Times, Tether has appointed KPMG to conduct its first full independent financial statement audit, while engaging PwC to prepare its internal financial systems ahead of the review, marking the first time the stablecoin issuer has worked with two Big Four firms simultaneously. The move replaces its prior reliance on narrower reserve attestations and expands the scope to include assets, liabilities, internal controls, and reporting frameworks. Tether had earlier stated it had “entered a formal engagement with a Big Four accounting firm to complete its first full independent financial statement audit,” and described the process as “the biggest ever inaugural audit in the history of financial markets.”

USDT circulation is reported at roughly $185 billion, with Tether’s latest disclosures showing about $193 billion in total assets against $186.5 billion in liabilities, leaving more than $6 billion in excess reserves. The reserve composition remains heavily weighted toward short-term sovereign debt, with approximately 82% allocated to short-dated U.S. Treasury bills, while smaller portions are held in Bitcoin and gold. Crypto price movements tied to these holdings are typically tracked through COIN360’s crypto price index, which aggregates crypto price and coin market cap data across major digital assets.

Regulatory developments in the United States have accelerated the audit push, following the signing of the GENIUS Act in July 2025, which established a federal framework for payment stablecoin issuers. The law requires issuers to maintain at least 1:1 reserves in approved assets such as U.S. currency, Federal Reserve deposits, or Treasury bills maturing within 93 days, while prohibiting rehypothecation and mandating monthly reserve disclosures reviewed by independent accounting firms. Stablecoin issuers exceeding $50 billion in outstanding supply must also produce annual audited financial statements under U.S. GAAP.

Compliance requirements extend to executive accountability and operational structure, including CEO and CFO certifications backed by potential criminal liability for false disclosures, classification as financial institutions under Bank Secrecy Act rules, and restrictions preventing issuers from offering yield or interest to holders. The framework also grants stablecoin holders priority claims over reserve assets in bankruptcy scenarios, defining a stricter legal perimeter for large issuers operating in U.S. markets.

Tether has simultaneously advanced its U.S. expansion strategy through the launch of its domestic stablecoin USAT on January 27, 2026, issued by Anchorage Digital Bank under oversight from the Office of the Comptroller of the Currency, with Cantor Fitzgerald acting as reserve custodian. The product is based in Charlotte, North Carolina, and led by Bo Hines, the former Executive Director of the White House Crypto Council, with circulation reaching approximately $28 million by March 2026.

USAT has been distributed across multiple trading platforms including Kraken, OKX, Crypto.com, and Bybit as an ERC-20 token on Ethereum, positioning it for institutional usage. Tether has stated the product is designed for regulated domestic markets and is not intended to replace USDT, which continues to operate globally.

The audit initiative comes alongside reported plans for a fundraising round between $15 billion and $20 billion at a $500 billion valuation, with transparency efforts seen as a prerequisite for attracting institutional capital. Previous concerns over disclosure practices had complicated Tether’s ability to expand within the United States, despite USDT remaining the most widely used stablecoin globally.

Historical regulatory scrutiny remains part of the company’s backdrop, including a $41 million settlement with the Commodity Futures Trading Commission in 2021 over misleading statements regarding reserves. Competitive pressure has also emerged, with Circle’s stock reportedly declining 20% during the same week as Tether’s audit developments, amid shifting expectations in the regulated stablecoin market.

Legislative uncertainty continues with the CLARITY Act, which passed the House with 294 votes in July 2025 but remains stalled in the Senate Banking Committee over provisions related to stablecoin yield. Current proposals prohibit passive yield on idle balances while allowing activity-based rewards, with industry participants including Coinbase raising objections to the existing language as discussions continue ahead of a potential vote window between May and June 2026.

This article has been refined and enhanced by ChatGPT.