Tether’s 116-Ton Gold Reserve Tightens Global Market Supply

• Tether now holds 116 tons of gold, placing it alongside major central bank reserves.
• Its buying accounted for 2% of global demand, tightening supply and shifting sentiment.
• A planned 100-ton gold acquisition in 2025 could further amplify market influence.

Tether has become a significant force in the global gold market, according to the Financial Times report. Jefferies reported that the company accounted for almost 2% of total worldwide gold demand last quarter. Analysts said this level of buying tightened short-term supply and affected overall market sentiment. They noted that Tether’s activity may have contributed more to gold’s recent price rise than previously understood.

Jefferies stated Tether currently holds 116 tons of physical gold. This puts the stablecoin issuer in line with the national reserves of South Korea, Hungary, and Greece. According to the report, Jefferies referred to Tether as holding the most gold outside central banks. Analysts said this role gives the company noticeable weight in one of those markets usually shaped by sovereign institutions.

Tether’s Gold Buying Surges to 12% of Central Bank Demand

The report estimated that Tether buying had accounted for almost 12% of all central bank last-quarter purchasing. Jefferies said this scale of activity has the ability to influence short-term market movements. Analysts also pointed out that the rapid accumulation of firm in the past two months likely made the supply tight and provided a reason for more speculative inflows into gold.

The company plans to purchase another 100 tons of gold in 2025. The company is reportedly on track to report a profit of $15 billion this year. Jefferies said that this revenue provides enough financial strength for Tether to meet its new goal without difficulty.

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Tether has also diversified its investments in the overall precious metals sector. The company has spent over $300 million this year purchasing interests in mining-related companies. In June, it took a 32% stake in Canadian gold royalty company Elemental Altus Royalties. Analysts said these moves are a sign of interest in long-term exposure to gold-linked assets.

Source: Financial Times

Expansion Into Mining and Refining to Boost Reserve Mix

The company is looking at additional investments in the gold supply chain. These fields include mining, refining, trading, and royalty operations. Jefferies said the company is trying to bolster reserve diversification and move away from reliance on traditional financial instruments.

Tether’s gold-backed token, Tether Gold (XAUt) has also grown quickly. Blockchain data shows that the amount of issuance doubled over the last six months. The company added 275,000 ounces of gold, worth $1.1 billion, since August. Analysts said this growth supports the company’s belief that tokenized gold will overcome storage, rollover, and fees associated with traditional gold products.

Source: Tether Gold

Jefferies also said firms’ operations have similarities to the operations of central banks. The company mints and redeems USDt directly, supply adjustments via primary markets, and reserves predominate with US dollars, gold, and Bitcoin.

It also involves freezing blockchain addresses on law enforcement request and phasing out high-risk blockchains. Analysts said these actions show the company’s growing influence in both digital and traditional markets.

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