Tether pauses $20B fundraising pending audit

Tether has paused plans to raise up to $20 billion as it awaits the results of its first full financial audit, a move that could impact one of the largest potential fundraisings in the crypto industry. The stablecoin issuer, which operates the most widely used dollar-pegged token in crypto, had been in discussions with a range of institutional investors before the process stalled.

The fundraising process which aimed to value the company at around 500 billion dollars has been delayed because investors demand more financial information about Tether. At that valuation, the round would place Tether among the most valuable private companies in the world.

Fundraising on hold pending audit

Tether announced its decision to hire one Big Four accounting firms for their auditing work although the company did not reveal which firm it selected or the date when the work would be finished. The lack of a public timeline has raised questions among prospective investors about whether the audit could extend well into 2026, further pushing back the fundraising window.
The company described the audit as a major milestone, while its finance chief said the firm is already operating at Big Four audit standards. That claim has been met with mixed reactions, as operating at a certain standard and having it independently verified are two different things in the eyes of institutional capital.
Some investors continue to support the company despite the audit delay and the company still lacks a finished audit.

Strong financial position reduces urgency

Tether announced that it performed an audit selection process which resulted in selecting one of the Big Four accounting firms for their upcoming audit work. The company selected an accounting firm for their audit work but did not reveal which firm they picked or when the audit work would finish. Part of the reason Tether can afford to wait is the sheer scale of its revenue, with the company reporting billions in profit over the past year primarily from the yield on US Treasury holdings that back its USDT reserves.
The company described the audit as a major milestone since their finance chief reported that the firm already meets Big Four auditing standards. With that kind of cash flow, the urgency to close a funding round is considerably lower than it would be for a company burning through capital.
A group of investors continues to support the company even though they lack a completed audit. For these backers, the bet is straightforward: Tether dominates stablecoin market share, and an eventual clean audit would only validate what they already believe.

Ongoing calls for transparency

Tether has faced ongoing investigation because of its financial reporting and reserve backing practices. Critics have argued that quarterly attestations fall short of the rigor a full audit would provide, particularly given the systemic role USDT plays across crypto markets.
The company provides regular attestations, thanks to its collaboration with BDO, the accounting firm. Yet, both investors and regulators have been insisting on a comprehensive, independent audit.

This difference is significant. Attestations provide confirmation of specific data at a particular point in time. In contrast, a full audit offers a more comprehensive view, including an evaluation of financial controls and the identification of potential liabilities.

The audit’s findings will dictate whether fundraising efforts persist, and they’ll also shape how investors assess the company’s value.