Tether is exploring US dollar financing for small commodity traders to simplify global trade and finance. Tether has assisted law enforcement agencies by blocking over 1.8 billion USDT and aided fraud prevention efforts around the world.
Tether, the company behind the stablecoin USDT, is taking calculated steps to diversify its operations outside the cryptocurrency industry.
With a focus on US dollar lending to small and medium-sized enterprises engaged in the sale of oil, metals and agricultural products, CEO Paolo Ardoino recently indicated that Tether is actively exploring prospects in the commodity trading space.
Due to lack of access to large financial networks, many small dealers have difficulty obtaining standard financing. Tether’s potential entry into this market could provide faster, more flexible financing options and avoid some of the legal hurdles imposed by traditional lenders.
Tether CEO Paolo Ardoino announced that the company is exploring opportunities in the commodity trading and traditional finance (TradFi) space. These businesses will be operated through an independent Tether investment arm and will have no impact on stablecoins.
— Wu Blockchain (@WuBlockchain) October 15, 2024
Strategic expansion into TradFi and commodity trading on the back of strong financial profits
The project is part of Tether’s larger attempt to enter traditional finance (TradFi).Given the importance of commodity trading to the global economy, Tether is providing liquidity to small and medium-sized businesses that are having difficulty raising capital. We believe this is a great opportunity to streamline payments.
Ardoino stressed that although the discussions are still in the early stages, the “huge” potential of the industry could lead to significant future expansion of Tether.
Interestingly, Tether’s strong financial performance leads to its development into TradFi and commodity trading. The business recorded an unprecedented profit of $5.2 billion in the first half of 2024, led by investments in traditional assets, including the US Treasury.
Tether’s strong financial strength allows it to boldly venture into other industries while maintaining its core business. Ardoino specifically informed investors that the company’s activities in commodity trading will be completely removed from the stablecoin’s reserves, thus preserving the stability of USDT.
Additionally, USDT, the stablecoin created by Tether, is steadily being used in cross-border transactions, including transactions involving major exporters of goods from countries such as Russia and Venezuela.
This highlights Tether’s growing importance in enabling global trade, especially in regions where sanctions and regulatory constraints pose obstacles to existing financial institutions. USDT’s liquidity and adaptability make it a desirable means of enabling faster and more seamless global trade transactions.
Meanwhile, as we previously reported, Tether has always shown a dedication to assisting law enforcement in fraud prevention.
The company helped the U.S. Department of Justice (DOJ) seize $6 million related to cryptocurrency trust fraud and demonstrated its opposition to illegal activity.
Additionally, Tether has blocked over 1.8 billion USDT of funds to 180 different law enforcement agencies, demonstrating the company’s commitment to keeping the financial environment safe and open.
