Figurines with computers and smartphones are seen in front of Tether logo in this illustration taken, February 19, 2024. REUTERS/Dado Ruvic/Illustration
LONDON, Jan 28 (Reuters) - Tether plans to allocate 10%–15% of its investment portfolio to physical gold, the crypto group's CEO Paolo Ardoino said, adding to the bullion which it says already backs some of its products.
El Salvador-headquartered Tether said it has about 130 metric tons of physical gold to back its products, after adding 27 tons in the fourth quarter. Ardoino told Reuters that it has been buying around two tons a week.
"For our own portfolio, it's reasonable that we are going to have around 10% in bitcoin and 10% to 15% in gold," Ardoino said, without disclosing the value of Tether's investment portfolio or how much of it was held in physical gold.
"It's hard to decide which one I like the most. It is almost like you have two children and have to decide which one is more beautiful," he added in a video interview.
Tether, which wants to maintain ownership of the physical gold stored in Switzerland, does not have a target for bullion buying and plans to make this decision on a quarterly basis.
Ardoino said Tether has been buying a lot of gold with its profits, having started in 2020 during the COVID-19 pandemic and continued to buy as geopolitical tensions rose in its wake.
"The world is not in a happy place at this moment. Gold is making all-time highs every single day. Why? Because everyone is scared," Ardoino said. Last year the gold price jumped 64%.
Tether said it bought large amounts of gold last year to back the Tether USDT stablecoin, a digital dollar with $186 billion worth of tokens in circulation, and the Tether XAUT gold token, with $2.7 billion in circulation.
Gold prices have risen 22% so far this year, hitting a record high at $5,311 a troy ounce on Wednesday on buying triggered by falling confidence in the dollar and concerns around the independence of the U.S. Federal Reserve.[GOL/]
Tether, which Ardoino said employs around 250 people, invests the reserves backing up its USDT stablecoin in U.S. Treasury bills and other assets.
Ardoino said he expects Tether's 2026 profit to exceed the $10 billion it is estimated to have earned in 2025 and possibly the $13.7 billion earned in 2024.
Tether has also invested its own profits in U.S. Treasuries, bitcoin, the tech sector, gold royalty firms and other assets.
(Reporting by Polina Devitt; Editing by Alexander Smith)
