Written by: Marcus Wolter, Daniel O’Brien, and Elizabeth Bestwick

Reports that Tether is in early discussions regarding a potential capital raise of up to $20 billion at a valuation that could approach $500 billion marks a significant inflection point for the stablecoin industry.[1] While Tether is best known as the issuer of USDT, the scale and structure of this fundraising effort point to a broader shift: stablecoin issuers are beginning to operate as full-scale capital-markets institutions.

This evolution has implications far beyond any single company or transaction.

From Stablecoin Issuer to Financial Institution

With approximately $186 billion of USDT in circulation and reported annual profits nearing $15 billion, Tether already operates at a scale comparable to major global financial firms, despite remaining privately held.

Recent reporting suggests that Tether has taken a highly disciplined approach to capital formation, including restricting unauthorized secondary sales by shareholders and exploring alternatives such as share buybacks or tokenized liquidity, while engaging in discussions with large institutional and strategic investors.[2]

This posture mirrors that of late-stage private companies and large financial sponsors, not narrow crypto infrastructure providers.

Tokenization as a Capital-Markets Tool

One of the most consequential aspects of this strategy is the reported exploration of equity tokenization as a liquidity mechanism. In the absence of a near-term IPO, tokenization offers a management-approved alternative to traditional private secondary markets.

Tether’s launch of its own tokenization platform, Hadron, in late 2024 was positioned as infrastructure for tokenizing stocks, bonds, and other real-world assets. Tokenizing equity does, however, not displace securities regulation; it changes the rails on which ownership is recorded and transferred, raising questions about transfer restrictions, KYC, and the venues on which such instruments can trade. In this framework, stablecoins function as the settlement layer for blockchain-native capital markets, rather than merely as payment instruments.[3][4]

Public Markets Are Already Reacting

The implications of this shift are no longer theoretical. Following disclosures that Tether had increased its equity position in Rumble Inc., Rumble’s stock logged a notable single-day gain, with the move widely reported alongside news of Tether’s additional 1 million-share purchase.[5]

While the price action cannot be attributed solely to one trade, the reaction is instructive. Public markets are increasingly treating capital deployment by stablecoin issuers as a meaningful signal, reflecting confidence in their balance-sheet strength, long-term commitment, and growing role as strategic investors.

Rumble is best understood not as the story itself, but as evidence of how stablecoin-driven capital is beginning to influence traditional markets.

Beyond listed equities like Rumble, Tether has also pursued higher‑profile transactions, including a reported bid for Italian football club Juventus that was ultimately rejected, as well as backing for a SPAC listing of a treasury‑management vehicle, reinforcing its trajectory from stablecoin issuer to multi‑asset capital allocator.[6][7]

What This Means for the Industry

The broader implications of Tether’s capital strategy are significant:

• Stablecoin issuers are providing capital-markets infrastructure, not just another payment option and are becoming themselves significant financial institutions.
  
• Tokenization is shifting from experimentation to necessity, particularly for private companies facing liquidity constraints.
  
• Regulatory focus will expand, as stablecoin issuers move deeper into capital formation, asset issuance, and market structure.
  
• Market participants are already pricing this evolution, as seen in public-market reactions to stablecoin-backed investments.
  
• At the same time, scrutiny around reserve quality and governance remains an important counterweight to expansion. In late 2025, S&P Global revised its stability assessment of USDT, citing concerns around disclosure and transparency relative to peers.[8] These dynamics highlight that as stablecoin issuers move deeper into capital formation and asset ownership, expectations around governance, disclosure, and risk management are likely to rise in parallel.
  
• Regulators are beginning to respond to this convergence between stablecoins and traditional finance. In the UK, the Bank of England has launched a consultation on a dedicated framework for regulating systemic stablecoins, signaling that instruments used at scale should be supervised in a manner comparable to other forms of private money.[9] Bank of England Governor Andrew Bailey has similarly stated that widely used stablecoins must be regulated “like money,” underscoring that policymakers increasingly view stablecoins as part of the core financial system rather than a peripheral crypto innovation.[10]

Looking Ahead

The significance of Tether’s $20 billion capital raise lies less in the fundraising itself and more in what it represents: the emergence of stablecoin issuers as potentially systemically relevant financial institutions.

As stablecoins, tokenization platforms, and capital-markets functions continue to converge, the traditional boundary between “crypto infrastructure” and “financial infrastructure” is rapidly dissolving. The industry and the market are already adjusting.

This publication is distributed with the understanding that the author, publisher, and distributor of this publication and/or any linked publication are not rendering legal, accounting, or other professional advice or opinions on specific facts or matters and, accordingly, assume no liability whatsoever in connection with its use. Pursuant to applicable rules of professional conduct, portions of this publication may constitute Attorney Advertising. The choice of a lawyer is an important decision and should not be based solely upon advertisements.

Sources

[1] Reuters. (2025, September 23). Crypto firm Tether eyes $500 billion valuation in major funding round, Bloomberg News reports. https://www.reuters.com/business/crypto-firm-tether-eyes-500-billion-valuation-major-raise-round-bloomberg-news-2025-09-23/

[2] Yahoo Finance. (2025, December). Tether Considers Tokenizing Stock Amid $20 Billion Fundraise. https://finance.yahoo.com/news/tether-considers-tokenizing-stock-amid-165853169.html

[3] Tether. Hadron by Tether Platform Brings Simplified Asset Tokenization to the Mass Market (Nov. 14, 2024). https://tether.io/news/hadron-by-tether-platform-brings-simplified-asset-tokenization-to-the-mass-market/ 

[4] Bloomberg. (2024, November 14). Stablecoin issuer Tether moves into tokenizing stocks and bonds. https://www.bloomberg.com/news/articles/2024-11-14/stablecoin-issuer-tether-moves-into-tokenizing-stocks-and-bonds

[5] Yahoo Finance. (2025, November 24). Rumble stock jumps after stablecoin giant Tether buys 1 million shares. https://finance.yahoo.com/news/rumble-stock-jumps-stablecoin-giant-184127046.html

[6] Tether. (2025, December 12). Tether submits proposal to acquire Juventus Football Club. https://tether.io/news/tether-submits-proposal-to-acquire-juventus-football-club/

[7] Reuters. (2025, December 9). Tether-backed Twenty One Capital set to slide into trading debut. https://www.reuters.com/business/tether-backed-twenty-one-capital-set-slide-trading-debut-2025-12-09/

[8] Yahoo Finance. (2025, November 26). S&P cuts Tether stablecoin rating to ‘weak’. https://finance.yahoo.com/news/tethers-stablecoin-downgraded-weak-p-142953869.html

[9] Bank of England. (2025, November 10). Bank of England launches consultation on regulating systemic stablecoins. https://www.bankofengland.co.uk/news/2025/november/boe-launches-consultation-on-regulating-systemic-stablecoins

[10] Reuters. (2025, October 1). Widely used stablecoins need to be regulated like money, BoE’s Bailey says. https://www.reuters.com/sustainability/boards-policy-regulation/widely-used-stablecoins-need-be-regulated-like-money-boes-bailey-says-2025-10-01/