Billionaire warns largest private gold holder could be insolvent

USDT-USD +0.02% BTC-USD +7.90%

Billionaire and BitMEX co-founder Arthur Hayes sparked a fresh round of scrutiny around Tether (USDT).

In a post on X on Nov. 30, Hayes said that the stablecoin issuer is “in the early innings of running a massive interest rate trade.”

Hayes claimed that Tether’s recent attestation shows a balance sheet increasingly exposed to gold and Bitcoin (BTC), which he said may struggle if interest rates fall.

Related: Largest private gold holder shuts down Bitcoin mining operations

According to Hayes, a decline of roughly 30% in those positions “would wipe out their equity, and then USDT would be in theory insolvent.”

"I'm sure some large holders and exchanges will demand a real-time view of their B/S so they can assess the solvency risk of Tether. Get out your popcorn, I expect the MSM to run wild with this, especially all the editors with TDS who want to s**t on Lutnick and Cantor for backing this stablecoin."

Former Citi analyst counters: ‘Tether isn’t going insolvent’

Joseph, a former Citi analyst, countered Hayes' argument.

Joseph, who said he spent “100’s of hours writing research on tether for Citi," argued that Tether critics are misunderstanding what the firm publishes.

Joseph wrote on X that Tether’s disclosed reserves are not its full corporate balance sheet. Instead, the published breakdown follows what he called a “matching philosophy,” aimed at showing how USDT is backed, not representing all corporate assets.

He added that the company holds separate corporate equity, including private investments, mining operations, corporate reserves, and possibly additional BTC, with profits distributed as dividends.

Joseph emphasized that Tether is “highly profitable,” estimating that the company has earned around $10 billion since 2023 from its roughly $120 billion exposure to US Treasurys yielding around 4%.

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Tether CEO pushes back

About an hour after Hayes' post, Tether CEO Paolo Ardoino also reacted to the post, albeit indirectly.

"Never cared for what they say, Never cared for the games they played," he wrote cryptically in one post on X.

Later, he pushed back by pointing to details in its third-quarter attestation, noting it maintains a multibillion-dollar excess reserve buffer and nearly $30 billion in group equity.

By the end of the quarter, the company held roughly $7 billion in excess equity on top of $184.5 billion in stablecoin reserves, plus about $23 billion in retained earnings — bringing total group assets to around $215 billion against $184.5 billion in liabilities.

Ardoino said critics, including S&P, overlooked this additional equity and the roughly $500 million in monthly profits generated from U.S.

"Some influencers are either bad at math or have the incentive to push our competitors. Forever trusting who we are. No, nothing else matters"

Tether's recent downgrade

On Nov. 26, S&P Global Ratings cut Tether’s score to “5 (weak),” the lowest tier on its five-point stablecoin risk scale launched in 2023.

The firm pointed to ongoing disclosure gaps and what it described as a growing allocation to higher-risk holdings, including Bitcoin, gold, corporate debt, secured loans and other investments, which it said introduce credit, market, interest-rate and FX risks.

S&P also highlighted that Tether offers limited visibility into the financial strength of its custodians and counterparties. Even so, the agency acknowledged that USDT has consistently held its peg through recent market swings.

Ardoino has publicly challenged the rating, setting up one of the most visible disputes yet between a major credit agency and a top stablecoin issuer.

Related: Tether now holds more US treasuries than Canada, CEO reveals

This story was originally published by TheStreet on Dec 1, 2025, where it first appeared in the Business News section. Add TheStreet as a Preferred Source by clicking here.