Tether, the world’s largest stablecoin issuer, has emerged as a significant, non-sovereign force in the global gold market, with its substantial purchases contributing to the metal’s recent price rally, according to a new report from investment bank Jefferies.
The report indicates that gold’s recent surge cannot be attributed solely to traditional investors. Tether’s notable accumulation of the precious metal, evidenced by financial and on-chain activity data, has introduced a new demand dynamic.
Jefferies estimates Tether accumulated at least 116 metric tonnes of gold by the end of the third quarter. This positions the company as the largest non-sovereign gold holder, making it comparable to smaller central banks.
This additional demand has tightened short-term supply, fueling the bullish sentiment that has seen gold prices climb over 50% this year, nearing $4,080 per ounce.
The bank’s interest in Tether’s gold strategy began during investor meetings in Denver last autumn. Industry insiders indicated Tether’s plan to acquire approximately 100 tonnes this year.
This premise gained further credence from public statements by Tether CEO Paolo Ardoino, who confirmed the company’s intent to diversify its reserves with gold. The price of gold subsequently rose by nearly $1,000 per ounce.
Of Tether’s total gold holdings, approximately 12 tonnes support its XAUt token, valued at about $1.57 billion. Another 104 tonnes back USDT, equivalent to roughly $13.67 billion. The market value of XAUt stands at around $1.5 billion.
The speed of Tether’s accumulation was a key observation in the Jefferies analysis. In the third quarter alone, Tether reportedly acquired about 26 tonnes.
This figure represents roughly 2% of global demand, and while not dominating central bank flows, it significantly limited available supply in the short term. This activity reinforced the upward momentum in gold markets.
Jefferies suggests this trend could continue if USDT’s market capitalization grows and gold remains approximately 7% of its reserves. Ardoino’s projections of $15 billion in profits for 2025 hint at substantial future gold acquisitions.
The bank calculates that if Tether allocated half of these projected profits to gold, it could add approximately 60 tonnes annually to its holdings.
Tether has also expanded its footprint in the gold ecosystem through investments. The company committed over $300 million this year to royalty and streaming firms.
These investments signal a broader strategic interest in precious metals. Furthermore, the recent hiring of two experienced metal traders from HSBC suggests Tether’s engagement in the sector is not only sustained but accelerating.
The report also touched upon Tether’s initiative to launch a new stablecoin for the U.S. market, USAT, which would not require gold backing. The long-term impact of this new asset on demand for USDT and gold remains uncertain.