S&P World Scores, the American credit standing company, has assigned Tether its lowest doable ranking, drawing a powerful rebuttal from the corporate behind the world’s most generally used dollar-pegged token.
S&P Points ‘Weak’ Evaluation for USDT
On Wednesday, S&P World Scores assigned Tether its lowest stablecoin danger ranking: “5 (weak)”. This determination displays ongoing considerations about reserve transparency and the composition of belongings backing USDT.
In keeping with S&P, Tether nonetheless supplies inconsistent disclosure round its holdings. Furthermore, the company emphasised {that a} rising share of the reserves now consists of higher-risk belongings, similar to Bitcoin, gold, company bonds, and secured loans. This introduces larger publicity to market and credit score volatility.
S&P highlighted that Bitcoin alone accounts for about 5.6% of USDT’s circulating provide, exceeding the corporate’s 3.9% overcollateralization buffer. Due to this fact, the company warned that important declines in Bitcoin or comparable belongings might weaken the inspiration supporting USDT redemptions.
Past asset combine, S&P pointed to credit score, market, interest-rate, and foreign money dangers inside Tether’s reserve construction. It additionally famous restricted visibility into the standard of custodians and counterparties.
Even so, the company acknowledged that USDT has persistently maintained sturdy worth stability throughout latest intervals of market stress.
Tether CEO Criticizes Score Strategy
Tether CEO Paolo Ardoino responded shortly to the downgrade, arguing that the ranking displays outdated analysis strategies somewhat than the realities of digital-asset markets.
He stated conventional credit score frameworks, designed for banks with lengthy histories and opaque steadiness sheets, are ill-suited to firms with completely different buildings and quicker reporting cycles.
Moreover, Ardoino identified that these similar legacy fashions as soon as supported main monetary establishments that later collapsed, suggesting they could not supply a dependable blueprint for assessing crypto issuers.
He described Tether as “overcapitalized” and stated conventional finance stays uncomfortable with corporations that function outdoors what he referred to as a “damaged monetary system.”
to S&P concerning your Tether ranking:
We put on your loathing with satisfaction.
The classical ranking fashions constructed for legacy monetary establishments, traditionally led non-public and institutional traders to take a position their wealth into firms that regardless of being attributed funding grade…
— Paolo Ardoino 🤖 (@paoloardoino) November 26, 2025
USDT Issuer Defends Its Reserve Administration
Tether expanded on this criticism in its formal response, saying S&P’s evaluation misrepresents the corporate’s efficiency and resilience. Particularly, it emphasised its capacity to navigate banking disruptions, alternate failures, and sharp market swings whereas sustaining entry to redemptions.
The corporate said that it has issued about $184 billion in USDT since launch. It additionally emphasised that it continues to carry adequate reserves, together with U.S. Treasuries and different belongings, to help withdrawals always.
Earlier this week, the Monetary Occasions reported that Tether has develop into the most important unbiased holder of gold, highlighting its rising publicity to different reserve belongings.
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