KPMG U.S. issued an unqualified opinion on Tether International S.A. de C.V.'s financial statements for the year ended December 31, 2025, Tether announced on August 13, 2026. The audit confirmed reserves exceeding liabilities by $6.814 billion across a $184 billion USDT balance sheet. It is the f...
"We have completed the largest inaugural financial audit in history." — Paolo Ardoino, CEO, Tether
KPMG U.S. issued an unqualified opinion on Tether International S.A. de C.V.'s financial statements for the year ended December 31, 2025, Tether announced on August 13, 2026. The audit confirmed reserves exceeding liabilities by $6.814 billion across a $184 billion USDT balance sheet. It is the first full financial audit in Tether's eleven-year history, replacing a regime of quarterly attestations from BDO Italia.
The milestone lands at a moment of acute regulatory pressure. The GENIUS Act, signed into law in July 2025, mandates that stablecoin reserves consist exclusively of qualifying high-liquidity assets — U.S. dollars, insured deposits, Treasuries maturing within 93 days, and qualifying repos. Approximately 25% of USDT's reserves, including $8 billion in gold, $7 billion in Bitcoin, and a book of secured loans, do not qualify. That gap amounts to roughly $47 billion that Tether must restructure or reclassify if USDT is to remain accessible on U.S. exchanges past the July 2028 grace period. Rather than restructuring its flagship token, Tether launched a separate U.S.-compliant stablecoin, USAT, in January 2026 through Anchorage Digital Bank.
The audit itself, however, has not been made public. Neither the audited financial statements nor KPMG's signed opinion have been released. For a company that controls 59% of the $308 billion stablecoin market, this creates a transparency paradox: a clean audit exists, but no one outside Tether can read it.
KPMG U.S. audited Tether International S.A. de C.V.'s consolidated financial statements for the fiscal year ended December 31, 2025. The engagement produced an unqualified opinion — the highest assurance level in financial auditing, indicating no material misstatements were identified.
According to Tether's announcement, the audit scope covered:
The audit confirmed excess reserves of $6.814 billion above total USDT liabilities of approximately $186.5 billion as of year-end 2025. This represents an overcollateralization ratio of approximately 103.7%.
The engagement is distinct from Tether's existing quarterly attestation regime. BDO Italia, a mid-tier firm, has published reserve attestations for Tether since 2021. These attestations are limited in scope — they confirm a snapshot of reserves on a single day rather than examining the full year's financial activity. The KPMG audit covers continuous financial operations across the 2025 calendar year.
The audit's significance is undercut by its opacity. As of August 23, 2026, neither the audited financial statements nor KPMG's signed audit report have been publicly released. Reuters confirmed the audit was not made public. Tether's announcement disclosed headline figures — the clean opinion, the $6.814 billion surplus — but the supporting documentation remains internal.
This matters for several reasons:
According to Startup Fortune, "Tether got its first full KPMG audit and still won't show you the report." The company has not indicated when or whether the full audit will be released.
Tether's Q1 2026 quarterly attestation, published by BDO Italia, provides the most recent public breakdown of USDT's reserves:
| Asset Category | Approximate Allocation | Estimated Value | |---|---|---| | U.S. Treasuries | ~82% | ~$150.4B | | Money Market Funds | ~10% | ~$18.3B | | Repo Agreements | ~5% | ~$9.2B | | Gold | ~4.3% | ~$8B | | Bitcoin | ~3.8% | ~$7B | | Secured Loans & Other | ~1.5% | ~$2.8B |
The Treasury allocation has grown significantly. As of Q2 2025, Tether reported $127 billion in U.S. Treasury exposure, making it one of the largest holders of U.S. government debt globally. By year-end 2025, that figure reached $141 billion.
The non-Treasury holdings — gold ($8B), Bitcoin ($7B), and secured loans — represent the core compliance challenge. These assets generate returns (gold appreciated significantly through 2024-2025; Bitcoin holdings were valued at $8.4 billion at year-end 2025 per Tether's attestation), but they fall outside the GENIUS Act's qualifying asset categories.
The GENIUS Act (Guiding and Establishing National Innovation for U.S. Stablecoins Act), signed July 18, 2025, established the first comprehensive U.S. federal framework for payment stablecoins. Section 4 defines six categories of qualifying reserve assets:
Assets explicitly excluded: precious metals, cryptocurrencies, corporate bonds, secured loans, and any security with remaining maturity exceeding 93 days.
On August 18, 2026, the Treasury Department issued implementing regulations that added criminal penalties for unauthorized stablecoin issuance, according to TechTimes. The rules define who qualifies as a Permitted Payment Stablecoin Issuer (PPSI) and require ongoing compliance with reserve standards.
Tether, domiciled in El Salvador, sits outside the GENIUS Act's direct jurisdiction over U.S.-chartered issuers. However, the Act requires foreign-issued stablecoins to obtain a Treasury reciprocity determination to remain listed on U.S. exchanges. As of August 2026, that determination has not been issued. Without it, U.S. exchanges face a July 2028 deadline to delist non-compliant foreign stablecoins.
The arithmetic: approximately 25% of USDT's reserves — roughly $47 billion at current supply levels — consists of non-qualifying assets. To obtain reciprocity status, Tether would need to either divest these holdings, reclassify them outside the reserve structure, or demonstrate equivalent regulatory oversight from its home jurisdiction.
Rather than restructuring USDT's global reserve portfolio, Tether adopted a bifurcated approach. On January 27, 2026, the company launched USAT (USA₮), a separate U.S.-market stablecoin designed for GENIUS Act compliance from inception.
Key structural differences between USDT and USAT:
| Feature | USDT | USAT | |---|---|---| | Issuer | Tether International (El Salvador) | Anchorage Digital Bank (OCC-chartered) | | Reserve Custodian | Multiple (undisclosed) | Cantor Fitzgerald | | Reserve Composition | Treasuries, gold, BTC, loans | 100% qualifying GENIUS Act assets | | Auditor | KPMG (first audit, unpublished) | Subject to OCC examination | | Regulatory Oversight | BVI/El Salvador | U.S. federal (OCC) | | Market Cap (Aug 2026) | ~$183B | ~$141M |
USAT's leadership is notable: Bo Hines, former White House Crypto Council Executive Director, serves as CEO. The token launched on Ethereum and became available on Kraken, OKX, Bybit, Crypto.com, and MoonPay.
Growth has been rapid in percentage terms but negligible in absolute terms. USAT's market cap grew more than 500% in April 2026, reaching $140.8 million — representing less than 0.08% of USDT's supply. By comparison, Circle's USDC commands approximately $71 billion in market cap, roughly 23% of the total stablecoin market.
The two-token approach allows Tether to maintain USDT's profitable reserve mix (gold and Bitcoin have generated significant returns) while using USAT to access the regulated U.S. market. The strategic question is whether U.S. exchanges and institutional counterparties will accept this structure or demand full USDT compliance.
The stablecoin transparency gap remains wide. A comparison of disclosure practices across major issuers as of August 2026:
| Metric | Tether (USDT) | Circle (USDC) | |---|---|---| | Full Financial Audit | Yes (KPMG, unpublished) | No full audit (monthly attestations) | | Attestation Provider | BDO Italia (quarterly) | Deloitte (monthly) | | Reserve Detail Level | Aggregate categories | CUSIP-level via SEC filings | | Daily Disclosure | Circulation data on tether.to | Holdings via BlackRock fund filings | | Regulatory Oversight | BVI/El Salvador | OCC (Circle National Trust) | | MiCA Authorization | Not obtained | Authorized as EMT | | S&P Stability Rating | Not rated | 2 (Strong), Dec 2025 |
Circle's advantage on measurable transparency dimensions is clear: monthly Big Four attestations, individual security identifiers published daily through SEC-regulated fund filings, OCC federal banking oversight, and MiCA authorization in Europe. However, Circle has never completed a full financial audit of its corporate entity — its attestations, while more frequent and detailed, are also limited in scope.
Tether's KPMG engagement, if published, would arguably represent a higher standard of assurance than any attestation. The gap is not in the audit's existence but in its accessibility.
Tether's profitability provides context for its reserve strategy. The company reported net profits exceeding $10 billion for 2025, down from $13 billion in 2024. Q2 2025 alone generated $4.9 billion in net profit.
The income derives primarily from:
At these profit levels, Tether earns more than most U.S. regional banks. The $10 billion annual figure places it in the same revenue tier as major financial institutions, despite operating with fewer than 200 employees, according to industry estimates.
This profitability creates a structural incentive to resist full reserve restructuring. Converting $47 billion in gold, Bitcoin, and loans into sub-93-day Treasuries would reduce portfolio diversification and potentially lower returns, though the current interest rate environment makes short-duration Treasury yields competitive.
Tether's KPMG audit represents a factual advancement in its disclosure history — from quarterly limited-scope attestations to a full-year financial audit conducted by a Big Four firm. The unqualified opinion, if taken at face value, addresses the longstanding question of whether USDT's reserves match its liabilities.
The advancement is incomplete. The audit remains private. The reserve composition includes $47 billion in assets the GENIUS Act prohibits for U.S.-compliant stablecoins. The Treasury reciprocity determination required for USDT's continued U.S. exchange access has not been issued. And Tether's two-token strategy, while pragmatic, creates an unusual structure: one token for global markets with flexible reserves, another for U.S. compliance with strict asset rules, both operated by the same parent company.
The stablecoin market's $308 billion in total supply depends materially on the resolution of these questions. USDT alone accounts for $183 billion of that total. Whether the audit's clean opinion ultimately strengthens or merely delays a reckoning with U.S. regulatory requirements depends on a disclosure decision Tether has not yet made: publish the report, or keep it private.