Tether Golden Empire: Tether's Ambition and Fractures of a "Borderless Central Bank"

Tether, the issuer of USDT, the world's largest stablecoin, is hoarding gold at an astonishing rate, holding $12.9 billion, and there are three major risks and challenges behind its ambition to build a “borderless central bank”. (Synopsis: Gold market welcomes a new era of crypto!) Stablecoin giant Tether poached two of Huifeng's top precious metals traders) (Background added: Shenzhen Shuibei sold gold for 300 days: the wealth, desire and humanity I saw in the “golden troubled times”) Tether, the issuer of the world's largest stablecoin USDT, is hoarding physical gold at an unprecedented rate. Tether's gold holdings have soared to $12.9 billion in the third quarter of 2025, compared to about $5.3 billion at the end of 2024. In just nine months, its gold holdings increased by more than $7.6 billion. Some market analysts pointed out that Tether has increased its gold holdings by more than one ton per week in the past year. This rate of stockpiling is even faster than the central banks of most sovereign countries. Not only that, Tether also began to acquire a controlling stake in gold mines, poaching the world's top precious metal traders, behind all these layouts, people seem to see that Tether is building a “borderless central bank” with U.S. bonds as the profit engine and gold and bitcoin as the value “hardcore”. However, behind the seemingly perfect business empire, is such a vision really feasible? $12.9 billion in reserves, $4 billion in floating earnings Tether's financial performance in 2025 is staggering. In the first nine months, its net profit exceeded $10 billion. This high yield also directly pushed Tether's valuation to $500 billion, which is comparable to OPENAI. This source of tens of billions of dollars of profit perfectly reveals the “alchemy” of Tether. It is mainly composed of two components: Operating profit: stable interest income from its holdings of approximately $135 billion in U.S. Treasuries. Book “floating”: from its holdings of gold and bitcoin reserves, generating huge unrealized gains during the bull market in 2025. Although Tether does not disclose the composition of profits, we can still make some general analysis. Among them, the potential yield of US Treasuries is about $4 billion (4% annualized yield). Gold's contribution is particularly prominent. At the beginning of 2025, gold was around $2,624 an ounce, and by September 30, it had soared to $3,859, an increase of 47%. Based on Tether's $5.3 billion gold stock held at the end of 2024, this “old gold” alone generated a floating profit of about $2.5 billion. By this estimate, and with new gold purchases in 2025, up to $3 to $4 billion of Tether's tens of billions of profits will come from gold appreciation. BTC's floating earnings are around $2 billion. This also directly leads to the composition of Tether's revenue, and gold has become a very important part. What Tether is doing is not just relying on gold to achieve huge profits, it is imitating the strategic reserve logic of a sovereign country and trying to control the entire gold industry chain from mining to trading. In June 2025, Tether Investments announced the acquisition of a strategic stake of up to 37.8% in Elemental Altus Royalties Corp., a publicly traded gold mining concessionaire, and retained the right to increase its stake to 51.8%, meaning Tether could take control of the company. Through this concession model, Tether will be able to secure a steady share of gold production for decades to come, without risking operating the mine, ensuring the security of supply of its gold reserves at the source. In November, Tether “poached” two of the world's top precious metals traders from HSBC. One of the poachers, Vincent Domien, is not only HSBC's global head of metals trading, but also a current board member of the London Bullion Market Association (LBMA). In addition, there is Tether Gold (XAUT), an independent gold tokenization product on the crypto market, which has a market capitalization of more than $2.1 billion. Tether, in partnership with Antalpha, a Singapore-based financial services company, plans to raise at least $200 million for a project called the Digital Asset Vault (DAT). The fund's goal is to accumulate XAUT tokens and build an “institutional-grade gold-backed lending solution” for them. “U.S. Bonds-Gold” Closed Loop, Casting a “Borderless Central Bank” Under a series of layouts, Tether has built a perfect business model: Absorbing US dollars: Tether issued USDT, absorbing nearly $180 billion in global markets. Investing in U.S. Treasuries: It invests the vast majority of them in highly liquid, high-security U.S. Treasuries. Earn interest: During the Fed's cycle of high interest rates, Tether can easily earn billions of dollars in “risk-free” interest each year. Buy gold: Use part of the profits to hoard gold and layout the gold industry to hedge against the risk of US debt depreciation or interest rate cuts. Excess reserves: By hoarding gold and Bitcoin, achieve excess reserve ratios, further consolidate the security and brand value of the stablecoin market, and ultimately achieve more stablecoin issuance. Behind a series of combined operations, Tether is no longer a simple cryptocurrency company. More like a “shadow bank” that has even evolved into a non-sovereign central bank. It holds more U.S. Treasuries and gold reserves than many countries. In the midst of this cycle, Tether has become one of the most profitable companies in the world. And began to further deploy in various fields such as AI, education, power, agriculture, etc., and continued to expand its business territory. The most important thing is that in the context of the rapid growth of the stablecoin industry, Tether, as a giant with “minting rights”, will form a strong influence in more industries and regions around the world, which may be a height that all commercial companies have never reached at present. The Three Rifts of the Perfect Empire However, behind perfection always seems to hide the beginning of another cycle. Tether's “perfect logic” is under triple threat from regulation, market and competition. Any one of these threats could stand in the way of its vision of a “central bank without borders.” Threat 1: Regulatory Wall Gold reserves have brought huge profits to Tether and have become its biggest stumbling block on the road to compliance. In July 2025, the United States signed the GENIUS Act, which explicitly requires stablecoin issuers operating in the United States to have reserves that are 100% backed by “high-quality liquid assets,” i.e. dollar cash or short-term U.S. Treasuries. This is exactly Tether's “seven inches”. According to Tether's Q3 report, its total reserves are as high as $181.2 billion, while the issued USDT is $174.4 billion. Of these, $12.9 billion in gold and $9.9 billion in Bitcoin, as well as other investments and loans, are all “non-compliant assets” under the GENIUS Act. J.P. Morgan's 2025 score…