Tether published its second-quarter reserve report on July 31, showing approximately $187.75 billion in assets and $183.64 billion in liabilities at June 30. The difference was about $4.11 billion.
The company’s release also reported approximately $1.5 billion in quarterly net operating profit, led by U.S. Treasury and repo activity. That operating figure is a different measure from the total change in the value of the company’s assets or equity.
What the reserve figures measure
The financial report concerns Tether International, S.A. de C.V. Its assets are treated as reserves backing the fiat-denominated tokens issued by that company, including assets above those needed to meet liabilities.
The reported buffer is the excess of assets over liabilities at the specified date. It is not a separate promise that the amount stays constant through future market movements or redemptions.
The accompanying assurance report explains that several asset categories are valued at fair value. Changes in market values can therefore affect the reported cushion even when operating income is positive.
The financial figures also distinguish the report from a full set of company financial statements. Reading the reserve table as a complete account of every group business would go beyond its stated purpose.
BDO’s assurance is tied to June 30
BDO performed a reasonable-assurance engagement under ISAE 3000 Revised and concluded that the report was fairly presented, in all material respects, under the stated criteria.
The scope is explicit. It covers the financial figures and corresponding assets and liabilities at June 30, not activity at every point before or after that date. Additional notes supplied by management are outside the assurance opinion.
The report also explains that asset valuations assume normal trading conditions. It does not establish what every asset could realize during extraordinary market stress or severe counterparty illiquidity.
For readers assessing the announcement, the useful distinction is between a dated reserve snapshot, the accounting basis used to prepare it and the separate operating-profit figure.
