Jefferies: Tether, which said it held 116 tons of gold in September, is “the largest holder of gold outside central banks”, buying 26 tons in Q3 and 24 in Q2
Remember about a month ago, when gold hit an all-time high, lots of commentators got on their hobby horses to huff about currency debasement?
Financial TimesBryce Elder
Context & Ripple Effects
Tether’s reported gold position had already risen from nearly 80 tons reported in July to 116 tons in September, while its gold-backed token had roughly 250,000 units in circulation in Q2. The new figures put a concrete scale on the company’s accumulation.
The purchases also extend Tether’s use of profits generated from reserve assets: it previously attributed part of its Q3 profitability to Treasury and gold holdings. Subsequent coverage of holdings near 140 tons suggests the accumulation did not stop with the reported quarter.
First-order effects
Tether becomes a materially larger participant in the physical-gold market, having added 50 tons across Q2 and Q3, according to Jefferies.
Its reserve mix gains greater exposure to gold, alongside the assets that have supported its reported profitability.
Second-order effects
Large, recurring purchases by a stablecoin issuer can make Tether’s reserve-management choices more consequential for bullion-market counterparties and custody providers.
Tether’s gold-token strategy gains a larger physical-asset base as it seeks to connect XAUT with physical and tokenized-gold access through its Gold.com investment.
Third-order effects
If such buying persists, major stablecoin issuers could increasingly function as institutional allocators across both sovereign debt and alternative reserve assets, rather than narrowly as token issuers.
That shift would make the composition, custody, and liquidity of stablecoin reserves a more central issue for market participants and policymakers, though this report alone does not establish an industry-wide change.
The trend: Stablecoin issuers are broadening from cash-like reserve managers into large-scale allocators whose asset choices can reach traditional financial markets.
Tether has paused nearly all Bitcoin purchases for several weeks, and is now the largest buyer of Gold in the world. They know the days of manipulating BTC are coming to an end, and trying to transfer their stolen wealth to an actual store or value before it all blows up. [image]
Tether is the largest independent holder of gold bullions outside of central banks and doesn't have an ever-expanding budget deficit Call me old school but sounds like AAA credit to me 🤷♂️
Government says Fort Knox gold may not be all there. Government stops mentioning Fort Knox gold. Bo Hines leaves government to work at tether. Tether suddenly becomes the largest independent holder of gold. Probably nothing [image]
“Tether's gold buys last quarter accounted for nearly 2 per cent of total gold demand and were equivalent to almost 12 per cent of central bank purchases” www.ft.com/content/37f8...
to S&P regarding your Tether rating: We wear your loathing with pride. The classical rating models built for legacy financial institutions, historically led private and institutional investors to invest their wealth into companies that despite being attributed investment grade
Why would you hold USDT instead of USDC? For trading some markets? Sure. Maybe occasional higher yield on lending? But there's no point being a stablecoin maxi: neither USDT nor USDC pass down the yield to holders. No equity exposure to Tether either. You get 100% of the [image]
S&P has a history of downgrading #Bitcoin builders, punishing them for embracing the hardest money while ignoring their own epic fails. Just downgraded Tether's USDT stablecoin to a “weak” rating, blaming Bitcoin exposure in reserves for potential volatility risks. Slammed [image…
S&P has just downgraded Tether's USDT rating from 4 to 5. It's the lowest rating possible. The main reason are persistent gaps in disclosure and high risk assets being held in its reserves. If Tether scores lowest grade and Sky B-, what would be a rating for DeFi as a whole? [ima…
Tether, “The Stable Company” just saw S&P cut its assessment rating from 4 to 5 - the lowest rating possible - citing persistent gaps in disclosure and high risk assets being held in its reserves. Only in crypto would the bedrock stablecoin of crypto trading be viewed as so [imag…
The article is bad enough for Tether. But the Tether guy's response at the end is pure Saylor-esque messianic utopian paranoid propaganda without actual semantic content. And nobody mentions that all those “other” assets don't really work under the “GENIUS” act do they? [image]
The S&P only attacks Tether, because Tether is challenging and beating the old financial guard at their own game. These old corporate entities cannot handle companies like Tether & Rumble taking their market share — their only recourse is to attack us because they're losing.
If you accept the S&P rating of Tether as “weak” then you must also assign a stability rating to traditional banks of “non-existent”. TradFi is mispricing the balance sheet strength of both Bitcoin and stablecoin companies. My advice to TradFi: look in the mirror first.