Stablecoin issuer Tether will explore financing opportunities in the commodity trading sector in a strategic move, according to a Bloomberg report on Tuesday citing undisclosed people close to the matter. Revealed the plan.
The new venture comes on the heels of record profits for the company, which is expected to generate an impressive $5.2 billion in revenue in the first half of 2024 alone.
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The move is seen as a direct response to the challenges faced by small commodity trading companies, which often struggle to secure the necessary credit facilities from traditional lenders. Tether’s involvement could provide a lifeline, less regulation and potentially more flexible financing options.
Tether CEO Paolo Ardoino acknowledged the company’s interest in the commodity space, stressing that it is still in the early stages of exploration. Although the exact investment amount has not yet been disclosed, Ardoino expressed optimism about the market’s growth potential, the report said.
Tether has been actively positioning itself for this new business. The company employs a dedicated team to develop trade finance opportunities and has a strong presence in the industry. Tether executives attended two major industry events in September, the Commodity Finance Industry Gathering in Geneva and LME Week in London, to showcase the company’s commitment to this new direction.
This new venture marks a major departure from Tether’s previous focus on the cryptocurrency market. The company has already established a foothold in certain regions such as Russia and Venezuela, where USDT is used to facilitate cross-border trade under US sanctions.
But why is Tether entering commodities?
The answer lies in the company’s huge profits. With billions of dollars in reserves, Tether is looking for new ways to leverage its capital. Attractive opportunities exist in commodity markets, with their vast assets and complex trading dynamics. However, this move is not without risks.
Nevertheless, Tether’s foray into commodities is a gamble that could change the landscape of global trade finance. If successful, it could cement the company’s status as a major player in the financial world beyond the realm of cryptocurrencies.
Earlier this month, Tether celebrated the 10th anniversary of the USDT stablecoin, with Ardoino saying, “Today, hundreds of millions of people around the world already use $USDt as a digital dollar in their daily lives. Tens of millions of new wallets are being added.” quarter. “
🎬Today marks the 10th anniversary of USD₮!
To commemorate this occasion, we will soon be releasing a documentary titled “Stability and Freedom in Chaos”.
how to travel $USDT is a lifeline for millions of people, fighting inflation and promoting economic freedom around the world. 🌎🤝 pic.twitter.com/oviKmIgpgx
— Tether (@Tether_to) October 6, 2024
