Stablecoin issuer Tether (CRYPTO: USDT) is exploring investments in the gold industry as part of its broader strategy to diversify profits from its cryptocurrency operations.
What Happened: Quoting sources, Financial Times reported on Friday that the company has held discussions with mining groups and investment firms about opportunities across the gold supply chain, including mining, refining, trading, and royalty agreements.
The move comes as Tether continues to generate significant profits from its USDT stablecoin, which has a market capitalization of $168 billion.
The firm earned $5.7 billion in profit during the first half of the year, largely through interest from U.S. Treasuries it holds as backing for the token.
Chief executive Paolo Ardoino has previously described gold as a “natural Bitcoin (CRYPTO: BTC),” emphasizing its role as a long-standing store of value and a complement to digital assets.
The company already holds $8.7 billion worth of bullion in a Zurich vault as part of its reserves.
Why It Matters: Tether has begun stepping directly into the sector.
Earlier this year, it purchased a $105 million stake in Canadian-listed Elemental Altus (CA: CVE), a gold royalty firm.
Last week, it added another $100 million investment as Elemental merged with EMX Royalty.
Juan Sartori, who oversees business initiatives at Tether, said the moves are part of a plan to expand the group’s “gold exposure.”
The company has also explored deals with other players, including Terranova Resources, though talks did not lead to an agreement.
Alongside this, Tether operates XAUt, a gold-backed crypto token, though it has limited adoption compared with USDT and currently has a market value of around $880 million.
Industry reaction has been mixed.
Executives in the mining sector have expressed surprise at the company’s ambitions, with one noting, “They like gold. I don’t think they have a strategy.”
Another described Tether as “the weirdest company I have ever dealt with.”
Beyond gold, Tether has been expanding into commodity trade finance, providing short-term funding for raw material shipments, with the scale of its trading book reportedly in the billions.
The company did not comment on its gold strategy.
Other firms are also experimenting with ways to link precious metals to digital assets.
Blue Gold (NASDAQ:BGL), a Nasdaq-listed miner with operations in Ghana, plans to issue digital tokens backed by its future gold production.
“A gold-backed token could really take off globally as a form of currency,” said chief executive Andrew Cavaghan.
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This article Tether To Explore Investments In Gold, The ‘Natural Bitcoin’ originally appeared on Benzinga.com
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