Stablecoin issuer Tether holds 116 tons of physical gold, making it one of the largest gold holders outside central banks, according to Jefferies. Tether’s gold purchases last quarter accounted for nearly 2% of global demand and almost 12% of central bank purchases, potentially influencing gold markets.

Tether’s aggressive accumulation of gold may have tightened supply and driven speculative inflows, with plans to acquire another 100 tons by 2025. With a projected $15 billion profit this year, Jefferies believes Tether’s target is achievable, as reported by the Financial Times.

Tether has invested over $300 million in precious-metal producers this year and acquired a 32% stake in Canada’s Elemental Altus Royalties. The company is also exploring investments across the gold supply chain, including mining, refining, trading, and royalty companies to diversify its reserves.

Tether Gold (XAUt), a gold-backed token launched in 2020, has doubled its issuance over the past six months, adding 275,000 ounces (about $1.1 billion) since August. With a market cap of $2.1 billion, Tether is betting on tokenized gold to gain traction among retail investors seeking to avoid the frictions of physical gold, futures, and gold ETFs.

Tether’s operations increasingly resemble those of a central bank, minting and redeeming USDT directly for customers and managing a reserve portfolio of US Treasurys, gold, and Bitcoin. The company generates income by earning interest on Treasurys while issuing a non-interest-bearing token, with policy-style tools like freezing addresses and phasing out blockchains to reduce risk.

Read more at Cointelegraph: Tether’s 116-Ton Gold Hoard May Be Moving the Market: Jefferies