Tether holds $24 billion in gold as purchases rival central banks: Bloomberg

Core Insights - Tether has accumulated approximately 140 tons of gold valued at around $24 billion, positioning itself as one of the largest bullion holders globally [1] - The company is purchasing between one and two tons of gold weekly to enhance its reserves and support its gold-linked cryptocurrency [1] Group 1: Gold Holdings and Market Impact - Tether purchased over 70 tons of gold in the past year, surpassing the reported acquisitions of all central banks except Poland, contributing to a 65% rally in gold prices [3] - Gold recently reached a record price of over $5,000 per ounce, increasing by 15% since January 1 [2] Group 2: Strategic Goals and Operations - Tether's CEO described the company's strategy as functioning like a "gold central bank," aiming to diversify profits from its USDT stablecoin into physical assets [4] - The firm stores its gold in a former nuclear bunker in the Swiss Alps and has hired senior gold traders from HSBC to enhance its trading operations [5] Group 3: Trading and Revenue Strategies - Tether plans to actively trade gold to exploit arbitrage opportunities between futures prices and physical metal costs, in addition to holding the metal [6] - The company has acquired stakes in royalty companies to capture mining revenue streams [6] Group 4: Future Projections - The circulation of Tether's XAUT gold token is expected to reach between $5 billion and $10 billion soon [7] - S&P Global Ratings has downgraded USDT to "weak" due to the increased risk associated with holding volatile assets like gold and Bitcoin [7]