How stablecoin companies make money

How do stablecoin companies make money if the coin is always worth a dollar and charges users nothing? The answer is the same as an old-fashioned bank's: they keep the money you handed over and earn interest on it. When you buy 1,000 USDT, Tether receives US$ 1,000, buys US Treasury bills with it and pockets the yield. You are left with a token that yields nothing. This guide shows the math with the figures Tether and Circle published in 2025 and 2026, what the reserves reveal about risk and what that changes for anyone holding part of their wealth in stablecoins.

In short

• Revenue is almost all interest: in Circle's case, US$ 2.64 billion of its US$ 2.75 billion in 2025 came from the yield on USDC reserves.
• Tether earned US$ 1.04 billion in the first quarter of 2026 and about US$ 1.5 billion in the second, with roughly US$ 141 billion in US Treasuries.
• The model depends on high interest rates and liquid reserves. When either fails, the dollar peg gets tested, as happened to USDC in March 2023.

The mechanism in one sentence

A fiat-backed stablecoin is a promise: for every token in circulation, the issuer holds one dollar (or something worth one dollar) and returns that dollar to whoever redeems. As long as the promise stands, the token trades at one dollar on exchanges. The issuer does not need to charge users because the money held does not sit idle: it goes into short-term US Treasury bills, repurchase agreements and money market funds, which pay interest. With US rates around 4% a year, every US$ 100 billion in circulation turns into roughly US$ 4 billion a year in revenue, with nothing paid to the token holder. The post what are stablecoins: USDT vs USDC explains the types of backing; this one follows the money.

Tether: the highest profit per employee in finance

Tether, the issuer of USDT, publishes quarterly attestations prepared by BDO. According to the first-quarter 2026 data, released in May: net profit of US$ 1.04 billion in the quarter; about US$ 141 billion in direct and indirect exposure to US Treasuries, placing it among the 20 largest holders in the world; total assets of US$ 191.8 billion against liabilities of US$ 183.5 billion, that is, US$ 8.23 billion in excess reserves; and about US$ 183 billion of USDT in circulation. Reserves also included around US$ 20 billion in physical gold and US$ 7 billion in bitcoin.

In the second quarter of 2026, operating profit rose to about US$ 1.5 billion, but excess reserves halved to US$ 4.11 billion, according to the attestation released at the end of July. That "excess" is the safety margin above what the company owes USDT holders; when it shrinks, it is not a shortfall in backing, but it is a number to watch.

Two points investors need to know. Tether publishes attestations, not a full audit: an attestation confirms balances on a date; an audit examines controls and the whole year. And part of the reserves sits in assets that are neither cash nor government paper (gold, bitcoin, secured loans), which raises the yield and also the volatility of the backing.

Circle: the same math, with open books

Circle, the issuer of USDC, listed on the New York Stock Exchange in 2025 (ticker CRCL) and therefore publishes full results. In 2025, total revenue plus reserve income reached US$ 2.747 billion, up 64%; of that, US$ 2.637 billion came from reserve income and only US$ 110 million from other revenue. USDC in circulation ended 2025 at US$ 75.3 billion, 72% above the prior year, and the reserve return rate was 4.1% for the year, down from 5.0% in 2024.

Circle also shows what Tether does not detail: distribution costs. Part of the yield is passed to partners that distribute USDC, notably Coinbase. After that, US$ 1.083 billion remained, a 39% margin. The year closed with an accounting net loss of US$ 70 million because of US$ 424 million in stock-based compensation tied to the IPO, with positive operating income of about US$ 157 million.

USDC reserves sit mostly in the Circle Reserve Fund, an SEC-registered money market fund managed by BlackRock, plus deposits at large banks, with monthly attestation.

What the reserves reveal about risk

The model has two dependencies, and both have failed before.

Interest rates. Revenue tracks the yield on US Treasuries. Circle saw its reserve return fall from 5.0% to 4.1% in one year. If rates fall to near zero, as between 2020 and 2021, the business shrinks and issuers tend to seek yield in riskier assets.

Liquidity of the backing. In March 2023, Circle had US$ 3.3 billion deposited at Silicon Valley Bank when the bank failed. For two days USDC traded below US$ 0.90, until the US government guaranteed the deposits. The backing existed; access to it, for one weekend, did not. A year earlier, in May 2022, UST, an algorithmic stablecoin with no dollar backing, lost its peg for good and wiped out tens of billions.

For anyone holding stablecoins, this means "worth one dollar" is a promise of variable quality, and the quality is in the reports: the share of short-term government paper, the size of excess reserves, the frequency and type of verification (attestation or audit), and where the bank deposits sit.

What this changes in your allocation

A stablecoin is a dollar with issuer risk and no yield. It is excellent as short-term cash, as a bridge between operations and for paying abroad, and a poor choice as a long-term store of value, because the reserve yield stays with the issuer and dollar inflation stays with you. Whoever wants dollars that earn needs another instrument; whoever wants only a stable dollar needs, at minimum, to diversify across issuers and keep the meaningful part in their own wallet, as crypto custody: self-custody vs third-party explains.

In Brazil there is one more layer: since February 2026, Resolution BCB 521 treats buying, selling and transferring stablecoins as FX operations, and in May 2026 the Central Bank argued to Congress that stablecoins should be treated as private money, which could bring the IOF tax. The post sending money abroad with stablecoins follows that topic.

Deciding how much of your wealth to keep in stablecoins, with which issuer and in which custody is an allocation decision. Vault Capital, a securities advisory firm authorized by Brazil's CVM under CVM Resolution 19/2021, handles it within the client's plan, with crypto and fixed income in the same view. Crypto assets carry high risk, including significant volatility and the possibility of losing the invested capital.

Frequently asked questions

Do Tether and Circle charge fees to USDT and USDC users?

Not on exchange purchases and sales; the exchange charges its own fee. The issuers earn from the reserve yield and charge fees only on direct redemptions with them, which usually require large amounts and institutional onboarding.

Why doesn't my stablecoin earn interest?

Because the reserve yield is the issuer's revenue. Products offering "yield on stablecoins" do not come from the issuer: they come from lending your token to third parties or protocols, with counterparty risk the stablecoin itself does not carry.

USDT or USDC: which has safer reserves?

Circle publishes audited financials and keeps reserves in an SEC-registered fund and large banks; Tether publishes quarterly attestations and holds part of its reserves in gold, bitcoin and loans, with larger excess reserves. They are different risk profiles, not an absolute "better". For meaningful amounts, splitting between the two reduces dependence on a single issuer.

Can a stablecoin lose its peg?

It can, and it has: UST in May 2022 (no dollar backing, permanent loss) and USDC in March 2023 (backing stuck in a failed bank, recovered in two days). The peg depends on liquid reserves and trust in the issuer.

Let's talk

If part of your wealth sits in stablecoins and you want to know how much makes sense to keep, with which issuer and where to hold it, Vault's diagnostic is free and carries no commitment, on WhatsApp, with a human advisor. Your assets always stay in your name.