Tether's Chief Technology Officer (CTO) Paolo Ardoino stated that as foreign competitive powers seek alternatives to the US dollar, the company is expected to become the dominant holder and active trader of gold reserves in terms of gold holdings and trading activities. He explained that this transformation is part of Tether becoming a de facto 'gold central bank' in a post-dollar world.
What happened: Tether's gold strategy
Ardoino told Bloomberg in an interview that Tether plans to expand its role in the global gold market, as it is highly likely that America's geopolitical rivals will develop gold-based currency alternatives to the dollar.
He stated that the company will continue to reinvest substantial profits into physical gold and is currently buying about 1 to 2 tons of gold per week.
The company has secured about 140 tons of gold stored in fortified facilities in Switzerland, known to be the largest gold reserve held by any institution except central banks, exchange-traded funds (ETFs), and commercial banks.
As precious metal prices have skyrocketed, Tether's gold holdings have surpassed $23.3 billion, with gold trading at approximately $5,234 per troy ounce.
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Tether is preparing to enter the gold trading market with an aggressive strategy to capture arbitrage opportunities, not just by holding physical gold. The company has recruited senior traders from major banks to lead bullion trading and is reviewing market structures and potential strategies.
Tether has also expanded its stock exposure by investing in Canadian companies related to precious metals, which aligns with the strongest metal rally since the 1970s.
Why It Matters: Stablecoins and Market Influence
Tether's flagship product, USDT, is the largest stablecoin with a circulation exceeding $186 billion, providing the company with a foundation to reinvest in assets like gold to expand its influence and profits.
The company also issues Tether Gold (XAUT), which has a market capitalization of approximately $2.62 billion, accounting for about half of the gold-backed stablecoin market.
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