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S&P Global Ratings Cuts Tether’s USDT Stability Rating to Lowest Level

S&P Global Ratings Cuts Tether’s USDT Stability Rating to Lowest Level

Following S&P’s downgrade, Tether CEO Paolo Ardoino cites billions in excess reserves and $30 billion in group equity to defend USDT’s stability amid ongoing transparency debates.

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Fact Check
The evidence strongly supports the truthfulness of the statement. Several high-relevance and high-authority sources corroborate the key claims. A Reuters news report explicitly confirms that S&P Global downgraded its rating for Tether to 'weak'. This is further detailed by two separate articles from a financial technology publication, which specify the new stability rating is '5 (weak)'. Given that the S&P stablecoin stability assessment scale runs from 1 (very strong) to 5 (weak), a rating of '5' constitutes the lowest possible level, validating the entire statement. The official S&P Global research portal also indicates the existence of a reassessment of Tether, lending primary-source credibility to the news reports. There are no contradictions in the provided evidence; the sources that do not support the statement are entirely irrelevant to the topic and focus on unrelated subjects like Senegalese debt or general market data. The consistency across multiple credible secondary sources makes the claim highly likely to be true.
Summary

S&P Global Ratings downgraded Tether’s USDT from 4 to 5, its weakest stability score, highlighting transparency issues and Bitcoin reserves exceeding 5% of backing. CEO Paolo Ardoino rejected the assessment, pointing to billions in excess reserves and $30 billion in group equity, citing Q3 2025 audit results. The downgrade has reignited calls from industry figures for Tether to reduce Bitcoin exposure, hold only U.S. Treasuries, and undergo full independent audits, while USDT remains pegged to the dollar.

Terms & Concepts
  • USDT (Tether): A U.S. dollar-pegged stablecoin issued by Tether, designed to maintain a 1:1 value ratio with the U.S. dollar.
  • Stablecoin Risk Scale: An assessment framework, such as S&P’s 1 to 5 scale, used to rate the relative stability and risk profile of different stablecoins.
  • Collateralization: The practice of backing a financial instrument such as a stablecoin with reserve assets, ensuring holders can redeem tokens for their underlying value.