Tether, the world’s largest stablecoin issuer by market capitalization, is expanding its focus into traditional finance (TradFi) and commodity trading, according to CEO Paolo Ardoino.
In an interview with The Block, Ardoino acknowledged that Tether is in the early stages of exploring opportunities in these areas. However, he added that these activities will be handled through Tether’s investment arm and will not affect the company’s stablecoin reserves.
“Tether is in the early stages of exploring various commodity trading and TradFi opportunities,” Ardoino said. “This operation will not impact stablecoin reserves as it will be carried out through a separate Tether investment vehicle.”
Tether is widely known for its role in developing USDT, a stablecoin pegged to the US dollar, but the company has expanded its operations and created distinct divisions, including an investment arm. Ardoino revealed in June that Tether plans to invest more than $1 billion within 12 months.
Bloomberg first reported on Tether’s commitment to commodity trading, noting that the company is in talks with several companies in the commodity space for US dollar financing. These moves come as Tether seeks to leverage capital to diversify its business and record profits. In July, the company announced that its net income for the first half of 2024 hit a record high of $5.2 billion.
Tether’s investment efforts are not new. In April, the company invested $200 million in BlackRock Neurotech, a biotechnology company focused on helping people with paralysis and neurological disorders. At the time, Ardoino reiterated that these investments are different from Tether’s stablecoin business, which requires large capital reserves.
Tether also made a notable investment in South American agricultural company Adecoagro SA, acquiring a stake worth approximately $102 million.
The transaction represents 9.8% of Adecoagro’s total outstanding shares, making Tether the company’s third largest shareholder.
Adecoagro, listed on the Nasdaq under the ticker AGRO, is Argentina’s leading milk and rice producer. The company, which has a market capitalization of just under $1.2 billion, also works in agriculture and renewable energy in Brazil, and grows crops such as soybeans and corn in Argentina and Uruguay.
