Tether, a leading stablecoin issuer, is diversifying its investment portfolio by exploring opportunities in the gold sector. The company, known for its USDT stablecoin, is looking to expand beyond its core business by considering investments in gold mining, refining, and royalty companies. This strategic move marks a shift towards taking equity stakes in gold producers, in addition to holding physical bullion in secure vaults.
Currently, Tether holds approximately $8 billion worth of gold in a vault in Zurich. In January 2020, the company launched Tether Gold (XAUt), a token backed 1:1 by physical gold. XAUt has seen significant growth, with a market cap exceeding $876 million and over 259,000 tokens in circulation. In August, Tether minted $437 million worth of new XAUt tokens in a single day, pushing the total market cap past $1.3 billion.
Paolo Ardoino, Tether’s CEO, views gold as a natural counterpart to Bitcoin and an integral part of the company’s strategy to bridge crypto and real-world assets. By exploring investments in mining and royalty companies, Tether aims to deepen its connection with traditional commodities and provide new funding streams to an industry that often faces high financing costs.
The potential investment in the gold sector by Tether could bring fresh demand to the market and support efforts to digitize ownership of bullion. It also highlights how Tether is using profits from its stablecoin operations to expand its reach into traditional commodities, further solidifying its position as a key player in the crypto space.
Aside from gold, Tether has been actively investing in various sectors, with over 120 companies in its portfolio. From self-custody tools to agriculture and royalty firms, Tether’s investments span a wide range of industries. Recent investments include a stake in Zengo Wallet, a self-custody app, and a majority stake in Adecoagro, an agriculture and energy group in Latin America. Tether has also acquired shares in Elemental Altus Royalties and backed Orionx, a Chile-based crypto exchange.
In August, Tether expanded its presence in Europe and Latin America’s digital asset markets by acquiring a minority stake in Bit2Me and leading a €30 million funding round for the platform’s expansion. These strategic investments showcase Tether’s commitment to diversifying its portfolio and exploring new opportunities in the ever-evolving crypto landscape.