A representation of the cryptocurrency Tether is seen in this illustration picture taken September 8, 2025. REUTERS/Dado Ruvic/Illustration REFILE - QUALITY REPEAT
PARIS (Reuters) -S&P Global has downgraded its rating of the world's largest stablecoin, Tether, citing an increase in higher-risk assets in the cryptocurrency's reserves and "persistent gaps in disclosure", the ratings agency said on Wednesday.
S&P in 2023 created a new scale from 1 to 5, to assess the risk of various stablecoins - a type of cryptocurrency pegged to mainstream currencies, usually the U.S. dollar. In a research note S&P said it now rated Tether's token, known as USDT, as "5 (weak)", which is the lowest possible score, downgrading it from "4 (constrained)".
A spokesperson forTether did not immediately respond to a request for comment. Tether has previously said its token is the "leading digital dollar, combining stability, transparency, and global accessibility."
El Salvador-based Tether says it has issued around $184 billion worth of its dollar-pegged cryptocurrency, and says itholds enough reserves in U.S. Treasuries and other assets to allow token-holders to swap their Tether tokens back for dollars.
S&P said there had been an increase in high-risk assets in Tether's reserves over the past year, including bitcoin, gold, secured loans, corporate bonds and other investments, "all with limited disclosures and subject to credit, market, interest-rate, and foreign-exchange risks."
"Tether continues to provide limited information on the creditworthiness of its custodians, counterparties, or bank account providers," S&P added.
Still, Tether has maintained "a notable level of price stability" even during periods of crypto market volatility, S&P's note said.
(Reporting by Elizabeth Howcroft; Editing by Tommy Reggiori Wilkes)
