Tether Becomes the World's Largest Gold Buyer, Surpassing Central Banks

Source: TokocryptoBlog Original Title: Not a Country, Tether Becomes the World’s Largest Gold Buyer! Original Link:

Tether and Its Gold Buying Strategy

Tether, the crypto company that issues stablecoins like USDT pegged to the USD and XAUt pegged to gold, according to data from investment bank Jefferies, bought 26 tons of gold in Q3—more than any central bank during the same period.

What is Tether and Why Is It Buying So Much Gold?

Founded in 2014, Tether Limited is a leading crypto company that issues the popular stablecoin USDT, a stablecoin designed to maintain a 1:1 ratio with the US dollar, providing liquidity in crypto trading. Now, USDT’s market capitalization has exceeded $184 billion.

Tether is often in the spotlight regarding the transparency of its reserves. As a response, the company diversified its assets beyond cash and government bonds, including Bitcoin and, most notably, now physical gold. This shift began to accelerate around 2021, along with the boom of tokenized assets.

As of September 2025, Tether’s gold reserves reached 116 tons. These reserves are worth around $13 billion, comprising about 104 tons backing USDT and 12 tons backing XAUt, Tether’s tokenized gold product.

Tether’s Massive Gold Purchases in Q3 2025

Amid rising gold prices, Tether has been busy buying up gold as part of its stablecoin reserves. Tether’s purchase of 26 tons of gold in Q3 was even larger than the gold purchases made by many countries.

For context, Kazakhstan bought 18 tons, Brazil 15 tons, Turkey 7 tons, and Iraq 6 tons during the same period. According to investment bank Jefferies, Tether accounted for around 12% of known central bank gold purchases that quarter and 14% in Q2.

This makes Tether not just a buyer but a dominant independent holder of physical gold, rivaling the national reserves of South Korea (about 104 tons, according to some estimates), Hungary, and Greece.

Although Tether is a stablecoin issuer, which should only buy US Treasury bills, Tether has recently become a very aggressive gold buyer. With 116 tons of gold, Tether is now the largest gold holder outside of central banks.

However, unlike sovereign entities that hoard gold for monetary stability, Tether’s purchases are driven by commercial demand, such as the surging circulation of USDT (from $174 billion to $184 billion in Q3), growing interest in XAUt amid economic volatility, and increasingly widespread crypto adoption.

Reasons Behind Tether’s Gold Buying Spree

Factors such as fiscal dominance, rising public debt, loose monetary policy, and eroding trust in fiat currencies. Investors, wary of inflation and geopolitical tensions, have driven many entities to flock to safe-haven assets like gold.

Tether has also stepped up its efforts to integrate gold into its reserves, which now make up around 7% of its total assets (about $13 billion).

Controversy Around Tether’s Gold Purchases

S&P Global quietly downgraded Tether’s stablecoin rating from “constrained” to “weak,” its lowest rating. This downgrade was due to Tether’s increasing share of risky reserve assets, such as Bitcoin at 5.6%, gold, secured loans, and corporate credit.

Tether CEO Paolo Ardoino responded by rejecting traditional financial criticism and emphasized the company’s resilience. Paolo also believes that legacy financial institutions have viewed Tether as a disruptor.

On the other hand, new US regulations passed in 2025 require permitted stablecoins to be backed 1:1 by liquid reserve assets like the US dollar or short-term US Treasury bills, not volatile or hard-to-liquidate assets like gold and Bitcoin.

Tether responded by launching a new regulatory-compliant token without gold, allowing USDT to continue operating outside the strict US regulations.