How This Crypto Firm is Outperforming World’s Largest Banks

In 2023, Tether generated a staggering $6.2 billion in net profit, causing a stir in the financial industry. Bitwise President Teddy Fusaro said the numbers are roughly comparable to major banks such as Goldman Sachs and Morgan Stanley.

Remarkably, Tether accomplished this with approximately 100 employees, demonstrating an unprecedented level of efficiency.

Will traditional financial (TradFi) institutions rush to cryptocurrencies?

The company’s performance is particularly impressive when compared to traditional large banks. For example, Tether’s per-employee income is at least 380 times the income of JPMorgan, one of the world’s largest banks by market capitalization.

This difference highlights the technological leverage of cryptocurrency companies to maximize profitability.

Read more: Cryptocurrency vs. banks: which is the smarter choice?

Institution name Total deposits as of December 31, 2023 (in millions) 2023 net income Total number of employees Net profit per employee
JP Morgan $2,400,688 $47,760 293,723 $162,602
goldman sachs $428,000 $7,907 48,500 $163,031
morgan stanley $346,000 $8,530 82,000 $104,024
tether $97,020,395 $6,180 100 $61.8 million
Net profits of top multinational banks compared to Tether. sauce: Maelstrom/X (Twitter)

However, Tether’s success has sparked debate within the financial ecosystem.some community members believe Its dominance in the stablecoin market in particular, with USDT having over $100 billion in circulation, is believed to have the potential to encourage traditional financial institutions to consider cryptocurrencies more seriously.

Conversely, JPMorgan has expressed concerns about Tether’s rapid growth and the regulatory challenges it faces. The bank highlighted potential risks to the broader cryptocurrency ecosystem, citing Tether’s ongoing issues with regulatory compliance and transparency.

Despite this, Tether’s management remains optimistic. CEO Paolo Ardoino believes the company’s market dominance is particularly beneficial for sectors that rely on stablecoins.

He highlights Tether’s proactive approach to working with global regulators to ensure a comprehensive understanding of the technology.

“While Tether’s market dominance may be bad for our competitors, including the banking industry, who want similar success, it has never been bad for the markets that need us most,” Ardoino said. Ta.

Read more: A guide to the best stablecoins in 2024

Advantages of the stablecoin market. sauce: Defilama

Additionally, Tether is also expanding into artificial intelligence (AI), aiming to make AI technology more accessible and efficient. By investing in areas such as renewable energy and Bitcoin mining, Tether advocates for open source and transparent practices, establishing itself as a leader in the AI ​​space.

This strategic move comes as discussions around the centralization of AI technologies gain momentum. Tether aims to foster innovation and prevent monopolistic behavior in the industry through its commitment to open AI models.

However, not everyone views Tether’s activities positively. X account Bitfinex’d accuses Tether and Bitfinex of engaging in fraudulent activities including money laundering.

“It’s money laundering. Criminal activity can be very profitable for a while,” Bitfinex’d Said.

These allegations, along with past regulatory penalties such as a settlement with the New York State Attorney General and a $41 million fine from the U.S. Commodity Futures Trading Commission, add another layer of controversy to Tether’s saga. .

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