S&P Lowers Tether's Dollar Peg Stability Rating to 'Weak'

Written by Emily J. Thompson, Senior Investment Analyst

Source: SeekingAlpha

Updated: Nov 26 2025

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Source: SeekingAlpha

S&P Global Ratings Downgrade: S&P downgraded Tether's ability to maintain its dollar peg from "constrained" to "weak" due to an increase in higher-risk assets backing its reserves, including bitcoin and corporate bonds.
Risks to USDT's Stability: The downgrade highlights concerns over Tether's reserve management, transparency, and regulatory framework, which could lead to USDT being undercollateralized if the value of its high-risk assets declines.
Tether's Financial Performance: Despite the downgrade, Tether reported a net profit exceeding $10 billion in the first nine months of the year, with significant growth in its market cap and substantial reserves in gold and bitcoin.
Market Context: The negative revision comes as bitcoin has retreated approximately 30% from its all-time highs earlier in the year, raising concerns about the stability of USDT's backing.

About the author

Emily J. Thompson

Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.