Tether’s $8 Billion Gold Hoard: A Swiss Safe Haven
USDT stablecoin issuer Tether has amassed almost 80 tons of gold valued at $8 billion. This massive gold reserve, stored somewhere in Switzerland, is said to collateralize its assets and provide a safe foundation for its digital currency.
The Secret Vault: A Worldwide Secure Place
Tether CEO Paolo Ardoino recently confirmed during an interview with Bloomberg that the company possesses nearly 80 tons of gold, with most of that belonging to Tether in its entirety. The company has gone to great extents to secure the reserve by keeping it in highly secure Swiss vault, though not revealing where this is for security reasons.
Ardoino called the vault “the most secure in the world” but wouldn’t specify when it was established. That secrecy, Tether explained, is essential to protect the gold from getting damaged.
Tether’s Gold Reserve: An Expanding Asset
The $8 billion gold reserve has earned Tether a position of being among the largest owners of gold in the world, aside from the normal banks and states. The holding is nearly equal to the combined reserves of metals and commodities held by UBS Group. Tether’s move to hold such a massive amount of gold was part of a grand plan to bring stability to the crypto scene.
Gold as a Safe Haven Asset
Ardoino highlighted the increasing relevance of gold, especially as an inflation hedge and as a hedge against economic uncertainty. He argued that gold, as a physical asset, offers a safer alternative to national currencies and that concerns regarding exploding U.S. debt could encourage people to turn to gold and other assets for a store of value.
With gold prices having risen by 38.5% over the past twelve months, Tether’s decision to keep a large reserve of gold now looks like a wise one, particularly when the gold price rose to its historic high of $3,390 per ounce in April.
Tether Gold and the Future of Digital Assets
Earlier this year, Tether launched 7.7 tons of physical gold to complement its digital asset Tether Gold (XAUT), a 1:1 backed stablecoin collateralized by untarnished gold reserves. Its market capitalization of over $811 million has made Tether Gold a strong contender as a digital replacement for physical gold.
Since Tether continues to hold and keep gold reserves, its role as a gold sector contributor and a cryptocurrency issuer also seems to increase.
