Tether released its Q4 2024 Attestation Report on Friday, showing significant growth in both assets and reserves. The report, audited by BDO Italia S.p.A., showed that Tether's consolidated total assets reached $157.6 billion as of December 31, 2024, with total liabilities of $137.6 billion, resulting in a net equity of $20 billion. The full report can be viewed here. (Remember, this is not an Audit, but an Attestation).

Having read this, and also the news on Thursday that USDt will now be on Bitcoin’s Lightning Network, and taking in to consideration that the man in the White House is an unusual President, (even more unusual than in his first term) who has now clearly ruled out CBDCs as on the agenda for the US (see his EO on this - link at the bottom of email), could it be that Tether will be the Official US Digital Dollar?

Tether is a major holder of US Treasuries with $113 billion, representing 1.4% of total US National debt ($36.22 trillion). For context, in March 2024 Tether’s Treasury holdings were $`91 billion. Tether is about number 16 in terms of the largest holders of US Treasuries globally. This puts Tether above some of the top sovereign and institutional holders such as Germany, ($102.3 billion), Saudi Arabia ($117.1 billion). In fact, Tether holds more US Treasuries than 90% of sovereign nations, including the UAE, Australia and Norway. Yuge.

In practical terms, Tether is currently the Unofficial US Digital Dollar. As an example, in this industry, a large number of brokers, if not most, accept USDT as collateral. Payments companies, in emerging markets at least, are happy to work with Tether, or are looking to do so based on conversations I have had.

In the White House Executive order issued on 23rd January, it is stated:

…”It is therefore the policy of my Administration to support the responsible growth and use of digital assets, blockchain technology, and related technologies across all sectors of the economy, including by:

(ii) promoting and protecting the sovereignty of the United States dollar, including through actions to promote the development and growth of lawful and legitimate dollar-backed stablecoins worldwide;

(v) taking measures to protect Americans from the risks of Central Bank Digital Currencies (CBDCs), which threaten the stability of the financial system, individual privacy, and the sovereignty of the United States, including by prohibiting the establishment, issuance, circulation, and use of a CBDC within the jurisdiction of the United States

So if CBDCs are ruled out, and stablecoins are in, I am coming to the thought that Trump could push for Tether to be the official US Digital dollar. For the following reasons:

Trump is pro-crypto and wants US leadership in Digital Assets,
Trump is very close to Cantor Fitzgerald’s CEO Howard Lutnick , his nominee for Commerce Secretary (apparently Lutnick was the one who made the phone call to Canada to let them know the US has just imposed 25% tariffs on them).Lutnick’s Cantor Fitzgerald has a 5% interest in Tether via a convertible bond
Tether is by far the most actively used stablecoin globally, de facto the unofficial digital dollar
Tether’s now being on the Lightning Network which makes it extremely efficient for cross-border payments, including micro-payments
Trump’s views that everything, as far as possible, be handled by the Private sector

Everything seems to be adding up to Trump viewing Tether as being the solution to having a digital US dollar. I shared this thought with an industry expert and he said “I think “official” badge not gonna happen. Unusual for a government to endorse a specific private solution”. My thoughts are, an unusual President who does unusual things may well give Tether an official badge. No need to reinvent the wheel - Tether is already in play and has massive first mover advantage in the Stablecoin space.

But this potentially unstoppable force is running in to an immovable object. Tether does not comply with the European Union’s MiCA, due to its non-holdings of European assets. USDC is, but is way behind Tether in adoption.

Could we see one of Trump’s next fights being with the EU over MiCA’s rules to back Tether?

Could Tether become the official US Digital Dollar - a Trump fight with the EU and MiCA?