The world's largest stablecoin company Tether has become a heavyweight player in the gold market, with its approximately 140 tons of gold reserves valued at about $24 billion, placing it among the largest gold holders globally, second only to central banks, exchange-traded funds, and large commercial banks. This cryptocurrency giant is aggressively hoarding gold with a central bank-like strategy and plans to enter the gold trading business to compete directly with traditional financial institutions like JP Morgan and HSBC.
According to a report by the Financial Times on the 28th, as gold prices soared from $3,858 per ounce at the end of September last year to over $5,200, the value of gold held by Tether surged by more than $5 billion. The company purchased an additional 27 tons of gold in the fourth quarter of last year for its gold-backed stablecoin, and this portion of its holdings has appreciated by at least $700 million this year. Heightened geopolitical uncertainty and U.S. President Trump's tariff threats and comments about seizing Greenland have driven gold prices to new highs this year.
Tether CEO Paolo Ardoino recently revealed in an interview with Bloomberg that the company has been purchasing gold at a rate of about 1 to 2 tons per week and plans to continue this purchasing pace &#34;at least for the next few months.&#34; According to Bloomberg's calculations, Tether purchased over 70 tons of gold for its reserves and gold stablecoin last year, surpassing almost all single central bank reported purchases—only Poland had a higher increase of 102 tons.
According to data from the World Gold Council, Tether's gold holdings are roughly equivalent to the size of the Qatar Central Bank. Jefferies analysts noted last November that &#34;Tether is the largest gold holder aside from central banks, with holdings comparable to smaller central banks in South Korea, Hungary, and Greece.&#34; The UK holds 310 tons of gold. The investment bank stated in its research report that Tether, as &#34;an important new buyer, may drive continued growth in gold demand,&#34; and its purchases may have contributed to the 65% surge in gold prices last year.
<h2>Rapidly Expanding Gold Empire</h2>
Tether earns huge profits through its US dollar stablecoin USDT. USDT is a giant in the industry, with a circulation of $187 billion. Stablecoins are a form of digital cash most commonly used by traders to convert between fiat currencies and cryptocurrencies. The company collects real dollars in exchange for USDT tokens and invests these funds in U.S. Treasury bonds and other assets (such as gold), earning billions of dollars in interest and trading profits.
USDT is pegged to the dollar at a 1:1 ratio, and Tether uses gold as well as other assets including Bitcoin, U.S. Treasury bonds, and secured loans to back this stablecoin. The company also has a separate gold-backed token XAUT and stores gold in vaults in Switzerland.
According to Bloomberg, most of the approximately 140 tons of gold consists of Tether's own reserves and the physical gold backing its gold tokens. Reuters cited Tether's third-quarter audit report showing that as of the end of September, the gold value in the reserves backing the USDT dollar stablecoin was $12.9 billion, equivalent to about 104 tons of gold at that market price. As of the end of December last year, the gold backing the XAUT token was 16.2 tons
Paolo Ardoino revealed in an interview with Bloomberg that the company stores physical gold in a former nuclear bunker in Switzerland, protected by multiple heavy steel doors. &#34;It's a James Bond-style place,&#34; he said, &#34;it's just crazy.&#34; This highly secure vault is one of approximately 370,000 Cold War-era nuclear bunkers in Switzerland, now rarely used, but Tether's vault is active—over 1 ton of gold is transported in weekly.
Ardoino stated that owning physical metal is crucial. When asked if there would be a reduction in gold purchases at some point, the 41-year-old Italian said:
<blockquote>
&#34;Maybe we will reduce, we don't know yet. We will assess the demand for gold quarterly.&#34;
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<h2>From Reserves to Trading: Tether's Gold Ambitions</h2>
Ardoino is not satisfied with merely purchasing gold; he also hopes to trade gold through Tether—essentially competing with large banks like JP Morgan and HSBC that dominate the market.
To reflect its growing ambitions, the company poached two senior gold traders from HSBC to help manage its activities in the gold market. When these two senior gold traders left HSBC last year, there was much speculation in the industry about their next destination, with few guessing it would be Tether.
Paolo Ardoino stated that the company needs &#34;the best gold trading platform in the world&#34; to continue purchasing gold long-term and to take advantage of potential market inefficiencies. He added that the company is still analyzing the market, and potential trading strategies will be designed to &#34;maintain a very long physical gold position.&#34;
Tether is exploring how to actively trade its owned gold, including potentially capturing arbitrage opportunities when futures costs significantly diverge from physical gold prices. Purchasing approximately $1 billion of physical gold monthly is a logistical challenge. Ardoino mentioned that Tether buys directly from Swiss refineries as well as from the largest financial institutions in the market, with a large order potentially taking months to arrive.
He indicated that the company is exploring ways to improve the efficiency of the gold purchasing process, &#34;because 1 to 2 tons per week is a very substantial amount.&#34;
<h2>Central Bank-like Strategic Layout</h2>
In some ways, Tether's attitude towards gold resembles that of central banks. Like central banks, it values the liquidity of gold and the status of gold as a reserve asset that is not anyone's debt. Paolo Ardoino stated in an earlier interview with Bloomberg that gold &#34;is logically a safer asset than any national currency.&#34;
He mentioned this week that Tether's dollar stablecoin users in emerging markets &#34;are precisely those who love gold, who have always used gold to protect themselves from long-term currency depreciation by their governments.&#34; &#34;We believe the world is heading into darkness. We believe there is a lot of turmoil.&#34;
Gold rose more than 1.5% on Wednesday, marking its eighth consecutive trading day of gains and reaching a new high, following comments from U.S. President Trump indicating his satisfaction with the recent decline of the dollar, which has fallen to its lowest level since 2022
Tether's bullish stance on gold has also led it to acquire shares in gold royalty companies that specialize in purchasing revenue streams from gold miners. According to Bloomberg, the company holds nearly all shares of medium-sized Canadian-listed royalty companies, including Elemental Royalty Corp, Metalla Royalty &amp; Streaming Ltd, Versamet Royalties Corp, and Gold Royalty Corp. According to insiders, the rapid accumulation of royalty company shares is led by Juan Sartori—former Uruguayan senator, businessman, and co-owner of the English Premier League football club Sunderland.
In addition to physical gold, Tether has launched Tether Gold (XAUT), a gold token that can be redeemed for physical gold, accounting for 60% of the global supply of gold-backed stablecoins. The company has also introduced a smaller denomination version of the token called Scudo. Paolo Ardoino stated that XAUT &#34;is likely&#34; to reach a market circulation of $5 billion to $10 billion by the end of this year. In this case, the company may need to purchase over 1 ton of gold weekly for XAUT alone, not including the gold purchased for Tether's reserves.
Ardoino predicts that although XAUT and other gold tokens are still insignificant compared to the over $500 billion ETF market, their time will come soon. &#34;My view is that there are some foreign countries buying large amounts of gold, and we believe these countries will soon launch tokenized versions of gold as a competing currency to the dollar,&#34; he said.
On Tuesday, Tether launched USAT, its U.S.-specific token compliant with the U.S. Genius Act stablecoin legislation. The company is seeking to leverage the new stablecoin to expand into the U.S. market and hired Bo Hines, former head of the Trump Cryptocurrency Advisory Committee, last year to strengthen ties with Washington.
<h2>Risks and Controversies</h2>
For years, the company has faced scrutiny regarding its reserves. Last year, S&amp;P Global Ratings downgraded Tether's reserve rating to its weakest rating due to increased exposure to high-risk assets, stating that the rising proportion of high-risk assets made the token reserves &#34;more susceptible to market volatility.&#34;
According to the Financial Times, in November last year, USDT was downgraded to a &#34;weak&#34; stability rating by S&amp;P Global Ratings analysts, who indicated that their assessment &#34;reflects the increased exposure to high-risk assets in USDT reserves over the past year,&#34; including Bitcoin, gold, secured loans, and corporate bonds, along with limited disclosure.
In response, Paolo Ardoino stated, &#34;We proudly bear your disdain,&#34; adding that the company &#34;does not have toxic reserves.&#34;
However, purchasing gold also represents risks. Any deviation from holding dollars could lead to losses, jeopardizing the company's ability to ensure that its dollar stablecoin USDT always maintains a value of $1. Reuters reported that as of the end of September, gold accounted for only 7% of the reserves backing USDT, with U.S. Treasury bonds dominating
So far, Tether's gold bet has been a huge success. Its purchases coincided with the largest market surge since the 1970s, as investors and governments expressed concerns about holding dollars. John Reade, chief strategist at the World Gold Council, stated that Tether's purchases would impact gold prices, but are only a small part of the reasons for gold's astonishing rise. &#34;They are a component of the increase, but by no means the whole story,&#34; he said. However, he also pointed out, &#34;What's really interesting is that one of the major players in the cryptocurrency space views gold as the original trade against dollar depreciation.&#34;

Tether has entered the ranks of the world's top gold players, holding approximately 140 tons of gold (valued at $24 billion), comparable in scale to the Qatar Central Bank. As gold prices soar to $5,200, its holdings have gained over $5 billion in unrealized profits. Its strategy is extremely rare: purchasing gold at a frantic pace of 1 to 2 tons per week and storing it in a former Swiss nuclear bunker, with last year's gold purchases second only to Poland. The company has also poached talent from HSBC, aiming to challenge JP Morgan's dominance in trading and build a hard asset empire amid dollar volatility

- Tether has emerged as a major player in the gold market, holding approximately 140 tons of gold valued at $24 billion, positioning it among the world's largest gold holders.  
- As gold prices surged from $3,858 to over $5,200 per ounce, Tether's gold holdings increased significantly, with plans to actively trade gold and compete with major banks like JPMorgan and HSBC.  
- Tether's CEO indicated the company intends to purchase gold regularly while exploring ways to enhance its procurement efficiency, despite ongoing scrutiny regarding its reserves and potential market risks.

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Earned $5 billion effortlessly! The stablecoin leader Tether hoards 140 tons of gold, becoming the world's largest private gold vault