Introduction

On March 24, 2026, Tether, the issuer of the world's largest stablecoin USDT, officially announced that it has with one of the Big Four accounting firms (the specific name has not been disclosed) to in its nearly 12-year history.

USDT, a stablecoin pegged to the US dollar. According to an official announcement in March 2026, Tether's market cap has exceeded $184 billion, with over 550 million users worldwide. In terms of asset compliance, Tether had never undergone a full independent financial statement audit before; its quarterly reserve attestation reports have been issued by BDO Italia, a subsidiary of BDO, the world's fifth-largest accounting firm, since 2022. Now, after years of avoiding it, Tether has finally taken the initiative to start the audit process. This event has drawn significant attention from all sectors of the market. This article will further analyze the various factors driving Tether to proactively seek an audit, as well as the impact this first audit will have on Tether and the entire crypto industry, aiming to provide some insights for market participants.

What exactly is included in Tether’s first audit?

2.1 The difference between an attestation and an audit

, but what its official statement clearly describes as its first complete independent financial statement audit. From a professional standpoint, although both attestations and audits are types of third-party assurance, there are major differences between them.

to confirm that a stablecoin issuer's reserve assets are at least equal to the total supply of tokens in circulation. Audit, on the other hand, is a comprehensive examination of a company's entire financial system, covering the balance sheet, income statement, cash flow statement, internal control framework, governance protocols, and compliance with accounting standards. In terms of focus, attestations usually center on specific items, with the priority being to confirm whether there is a match between the reserve assets disclosed by the issuer and the token liabilities in circulation; an audit looks at the broader financial system, focusing not only on the assets and liabilities themselves but also extending to financial statements, internal controls, reporting processes, and related governance arrangements.

To put it simply, the difference is that while an audit goes further to answer whether "the company's overall financial information is reliable." Currently, having an independent issue attestation reports is still the common practice for self-disclosure among stablecoin issuers. Because of this, Tether’s shift from attestations to a full audit is not just an upgrade in disclosure format; it pushes the transparency requirements for stablecoin issuers into a more complete financial audit framework, .

2.2 Key parts of this audit

Based on the official announcement, the complete independent financial statement audit Tether is starting covers not only the company's existing reserve assets but also its systems, financial reporting, and internal controls. Although Tether did not disclose specific audit details in the official announcement, the complexity of auditing the reserve assets alone is quite high, and the workload will be substantial.

According to the Q4 2025 reserve attestation report issued by BDO, as of December 31, 2025, Tether's total assets were approximately $192.9 billion, with total liabilities of about $186.5 billion. In terms of asset allocation, Tether directly holds more than $122 billion in US Treasuries, hitting a record high; its direct and indirect exposure to Treasuries, including overnight reverse repurchase agreements, exceeds $141 billion, making Tether one of the largest holders of US Treasuries in the world. The reserves also include precious metals, Bitcoin, secured loans, and a small amount of corporate bonds. Additionally, Tether's own investment portfolio in areas like AI, energy, and fintech through its global investment fund has exceeded $20 billion, but these funds come from excess profits and are strictly segregated from the USDT reserves. For the auditors, Tether’s assets represent a composite reserve structure that straddles both traditional financial assets and digital assets. The auditors will not only need to verify the existence of these assets but also audit their ownership, valuation, liquidity, and how they match up against token liabilities.

Why is Tether starting this audit now?

3.1 Global regulations are tightening up everywhere

Looking at the current market, the continuous tightening of global crypto regulatory frameworks is a major factor pushing Tether to start a full audit as soon as possible.

In the United States, President Trump signed the GENIUS Act in July 2025, establishing a unified regulatory framework for payment stablecoins at the federal level for the first time. This law requires issuers to fully back circulating payment stablecoins with qualified reserve assets and publicly disclose the composition of those reserves every month. For issuers with a circulation exceeding $50 billion who are not subject to periodic reporting obligations under the Securities Exchange Act of 1934, the law also requires them to prepare annual financial statements according to US GAAP (US Generally Accepted Accounting Principles), which must be audited by a registered public accounting firm following applicable auditing standards before being made public and submitted to regulators.

In Europe, the rules for Asset-Referenced Tokens (ART) and E-money Tokens (EMT) under the EU’s Markets in Crypto-Assets Regulation (MiCA), which are directly related to stablecoins, have been officially applicable since June 30, 2024. Since then, the European Banking Authority has continued to push forward a direct supervision framework for ARTs and EMTs, with supporting rules that set more detailed requirements for reserve asset liquidity and the proportion of funds held in credit institutions; for "significant stablecoins," the minimum deposit ratio can be increased to 60%.

In Asia, the Hong Kong Stablecoin Ordinance officially took effect on August 1, 2025. Institutions issuing fiat-referenced stablecoins in Hong Kong or issuing HKD-pegged stablecoins abroad must apply for a license from the Hong Kong Monetary Authority (HKMA). On April 10, 2026, the HKMA officially issued the first two stablecoin issuer licenses: (License No. FRS01, a joint venture between Standard Chartered Bank (Hong Kong), HKT, and Animoca Brands) and The Hongkong and Shanghai Banking Corporation Limited (License No. FRS02). This marks the official entry of Hong Kong’s stablecoin regulation into the licensing and implementation phase.

A series of regulatory movements across different regions worldwide indicate that the compliance . The external requirements facing top-tier issuers have changed. In the past, reserve attestations could somewhat satisfy market concerns about whether an issuer had sufficient backing; however, as regulatory frameworks become increasingly institutionalized, market focus has shifted from the reserve coverage itself to the issuer's financial transparency, internal controls, governance capabilities, and their ability to undergo higher-standard, continuous external verification. For Tether, a full audit has become the company's "top priority." One of the key tasks for Simon McWilliams when he was appointed as CFO was to drive the company toward a full financial audit. If Tether does not take this step proactively, it faces the risk of being systematically excluded from the mainstream financial system.

3.2

Since the launch of USDT in 2014, doubts about whether "every USDT is fully backed by 1:1 USD-denominated assets" have never stopped.

In April 2019, the New York State Office of the Attorney General (OAG) launched an investigation and applied for an injunction against Tether and its affiliated exchange Bitfinex’s operator, iFinex. The investigation found that starting in mid-2017, Tether struggled to maintain normal banking relationships for a time and failed to back the USDT in circulation with 1:1 USD reserves in its own bank accounts during certain periods. Additionally, the OAG disclosed that Bitfinex suffered a loss of about $850 million due to its relationship with the Panamanian entity Crypto Capital Corp., and Tether’s reserve funds were used to plug this gap—the two companies were owned and controlled by the same small group of individuals, presenting a serious conflict of interest. In February 2021, the two parties reached a settlement: Bitfinex and Tether were required to stop all trading activities with New York users, pay an $18.5 million fine, and publicly disclose the composition of assets backing USDT every quarter, including loans or receivables between affiliated entities.

In October of the same year, the Commodity Futures Trading Commission (CFTC) fined Tether $41 million, determining that it had made false statements regarding its reserve adequacy between June 2016 and February 2019. According to the CFTC announcement, during a 26-month sample period from 2016 to 2018, Tether held sufficient fiat reserves on only 27.6% of the days. This means that for the vast majority of that time window, the full USD backing that Tether claimed was not actually realized.

Although Tether began issuing quarterly reserve attestation reports through BDO Italia after the settlement to disclose its asset composition to the market, these attestations are still significantly different from a full independent financial statement audit. Relying solely on attestation reports is far from enough to heal toward Tether.

3.3 Fundraising hurdles are forcing a transparency upgrade

Tether is one of the most profitable crypto companies in the world. According to its disclosures, its full-year profit for 2025 exceeded $10 billion, with excess reserves reaching $6.3 billion and US Treasury holdings totaling $141 billion. However, high profitability did not automatically turn into recognition from the capital markets. Looking at subsequent fundraising progress, what the market really cares about is no longer just the profit itself, but whether these profits, reserves, and asset allocations can withstand higher standards of external verification.

In November 2025, S&P Global Ratings downgraded its stablecoin stability assessment for Tether from 4 (Constrained) to the lowest grade of 5 (Weak). This assessment system measures a stablecoin's ability to maintain its peg to a fiat currency, with a scale ranging from 1 (Very Strong) to 5 (Weak). S&P noted that the reason for the downgrade was the continuous rise of high-risk asset exposure in USDT’s reserves, including Bitcoin, gold, secured loans, and corporate bonds, as well as the limited information disclosed about them.

Furthermore, according to Bloomberg, Tether sought a large-scale private placement in September 2025 with a valuation of approximately $500 billion, planning to sell about 3% of its equity to raise up to $20 billion, with the US financial services firm Cantor Fitzgerald serving as lead advisor. If the financing had been completed at this valuation, Tether would have joined the ranks of the world's most valuable private companies, alongside SpaceX and OpenAI. However, Tether’s fundraising did not go smoothly. In February 2026, the Financial Times reported that due to investor concerns over valuation and deal size, the fundraising amount under discussion had shrunk significantly from $15 billion–$20 billion to about $5 billion. Investors' core concerns were focused on two areas: first, Tether has never undergone a complete independent audit, leading to insufficient financial transparency; second, the regulatory environment remains uncertain.

When a company with an annual profit of over $10 billion cannot complete financing at its desired valuation, the market is effectively repricing the "lack of audit" weakness. In this context, an audit is not just a compliance requirement, but a prerequisite for Tether to enter mainstream capital markets.

What kind of impact will Tether’s audit have?

4.1 For other stablecoin issuers: Transparency standards are being forced upward

As the largest stablecoin issuer by market cap, Tether’s lead in starting a Big Four audit has objectively set a higher transparency standard for the industry. Previously, stablecoin issuers generally used reserve attestations, which are limited-scope assurance methods. This move by Tether might push the industry’s minimum compliance baseline from attestations toward full audits. Smaller and medium-sized issuers that remain at the attestation level may face greater disadvantages in institutional partnerships and regulatory access. The stablecoin industry might see a round of shakeouts where compliance capability becomes the deciding factor.

4.2 For institutional investors: The audit opens a compliant path for crypto asset allocation

For a long time, institutional investors like pension funds, sovereign wealth funds, and large asset management firms have remained cautious about the crypto market. One core reason is that the underlying assets lack financial transparency verified by recognized standards. As the most widely used trading medium and settlement tool in the crypto market, it is almost impossible for institutional funds to avoid exposure to USDT once they enter the space. Without Tether having undergone a full audit, investment strategies involving USDT lacked a sufficient basis for risk control, and many institutional plans were often shelved during the internal compliance approval stage.

If Tether’s reserves finally pass a Big Four audit and receive an unqualified opinion, USDT will, for the first time, have the backing of the world's strictest financial assessment standards. Consequently, the compliance departments of institutional investors will have formal documentation to submit to regulators, and the compliance threshold for institutional funds entering the crypto market will be lowered accordingly.

4.3 For exchanges and DeFi protocols: The liquidity landscape might be reshaped

USDT serves as a core liquidity infrastructure in the crypto market. According to Tether’s Q4 2025 report, as of December 31, 2025, the circulation of USDT was approximately $186.5 billion. Across major global crypto exchanges, USDT has the strongest liquidity for trading pairs. Market makers use USDT to provide quotes, users use USDT to move in and out of various assets, and many lending pools and liquidity pools in DeFi use USDT as the foundational collateral. It can be said that USDT is deeply embedded in every part of the crypto trading system; if its liquidity were to have issues, the impact would quickly spread throughout the entire market.

Because of this, the audit results will impact exchanges and DeFi protocols in two ways. If the audit passes smoothly, USDT’s position in the compliant market will be further solidified. Especially in licensed exchanges in the US and Asia, USDT verified by a Big Four audit will more easily gain regulatory recognition. However, if the audit exposes major reserve issues, exchanges may be forced to reduce their USDT exposure and increase alternative trading pairs, and DeFi protocols will need to re-evaluate the safety of assets used as USDT collateral.

4.4 For accounting firms: How a stablecoin audit precedent changes the auditing industry

Tether’s launch of its first complete independent financial statement audit is significant for accounting firms, not just because they’ve landed a massive crypto client, but because these high-controversy, high-complexity audit projects are starting to be included in the scope of business that mainstream audit institutions can formally enter and operate. The standards set by the Big Four cover internal controls, related-party transactions, valuation methods, and going concern status, far exceeding the attestation report framework currently used in the stablecoin industry. Once Tether completes its audit and receives a formal opinion, it will become the first large stablecoin issuer to go through a full financial audit. For regulators, the audit results will provide a reference benchmark for stablecoin disclosure standards; for other issuers, market and investor expectations for transparency will be raised overall, and maintaining current minimum disclosure levels may no longer be enough.

At the same time, the practice of the Big Four auditing crypto companies is building up a methodology for the industry. Once top-tier firms start accumulating experience in this field, stablecoin audits may shift from individual projects to a new type of professional service. The methodology formed during the Tether audit could become a reference paradigm for future crypto company audits, pushing the entire industry’s audit infrastructure from non-existent to established.

Closing Thoughts

For Tether, signing the audit contract is just the starting point. When the final report will be released, what reserve details it will reveal, and whether the audit opinion will be unqualified are still hurdles to clear. If Tether passes smoothly, it will put a period on its long-standing reserve controversy and provide a critical foundation of trust for the mainstreaming of the entire crypto industry. No matter the outcome, this step itself has already changed the rules of the game. This audit test isn’t just for Tether’s reserve assets—it’s a test of whether the entire crypto asset industry is ready to let its promises be scrutinized.