Tether is reportedly in the early stages of discussing USD financing opportunities with commodity traders.
Posted on October 15, 2024 at 6:03 AM ET.
Stablecoin issuer Tether is reportedly considering a move to traditional finance. One way the company plans to do so is potentially lend out billions of dollars in profits to commodity traders.
Tether is meeting with multiple commodity trading companies to discuss U.S. dollar financing opportunities, Bloomberg reported Monday. One of Tether’s big selling points was the use of USDT for more mainstream commodity trading.
Stablecoins pegged to the value of the US dollar could be a huge advantage for commodity traders who want to avoid unnecessary volatility, especially when trading in countries subject to US sanctions.
Tether CEO Paolo Ardoino confirmed the news to Bloomberg, saying the company is still in the “early stages” of exploring opportunities in the commodity space.
“We probably won’t reveal how much we plan to invest in commodity trading. We are still developing our strategy,” Ardoino said.
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Tether’s large cash reserves and liquidity place it among the top companies with large amounts of cash or equivalents. Tether reported a surprising profit of $5.2 billion in the first half of this year and disclosed that it holds $97.6 billion in U.S. Treasuries.
In addition to cash and government bonds, Tether invests in precious metals, corporate bonds, and a variety of other assets with the goal of generating income while maintaining liquidity. The company also has a $6.56 billion venture portfolio that invests in companies aligned with its mission.
