Many people are freaked out by Tether's balance sheet, thinking it looks like it's on the verge of collapse and about to go insolvent. This is the audit report as of September 30. According to the data in it, Tether's total assets are $181 billion, and total liabilities are $174 billion, leaving only a 3.74% buffer. Sounds scary, right? But first, the liabilities here don’t refer to debts from business operations, but rather the amount of USDT issued, which represents the obligation to redeem for users. So, the nature of this debt is more like deposits rather than loans, similar to how bank deposits work. And how much reserve do banks hold for deposits? 5% to 10%. That means if you deposit $10 in a bank, the bank only needs to keep at least $5, and the rest can be loaned out. Meanwhile, Tether is currently in a fully over-collateralized position. Secondly, even if you exclude its holdings of gold, BTC, corporate bonds, and other volatile risk assets, 77% of the remaining assets are all stable, liquid assets like cash, treasury bills, and money market funds. This means Tether’s cash reserves are at 77%, while banks typically only hold reserves at a maximum of 10%. So, which one is more likely to collapse? Here’s the link to the full audit report for the chart: https://assets.ctfassets.net/vyse88cgwfbl/6GbUTVK4tTYAytefu5daIi/6cac18eb4b526c9c52640a3d2bed9642/ISAE_3000R_-_Opinion_Tether_International_Financial_Figure_31-10-2025.pdf