Tether, the company behind the USDT stablecoin, has emerged as a significant accumulator of Bitcoin (BTC) over the past year. Their Bitcoin holdings have outpaced the inflows of many spot Bitcoin Exchange Traded Funds (ETFs).
On September 8th, Tether’s CEO, Paolo Ardoino, revealed figures indicating that Tether obtained over 27,700 BTC in the preceding twelve months.
Approximately 7,900 BTC of this total were directly allocated to reserves backing the USDT stablecoin. The remaining 19,800 BTC were assigned to Twenty One Capital (XXI), a digital asset treasury fund that receives contributions from Tether. This strategy has positioned XXI as a substantial Bitcoin holder.
Tether’s Bitcoin acquisitions surpass the inflows of several mid-sized spot Bitcoin ETFs, including VanEck’s HODL, Bitwise’s BITB, Ark 21Shares’ ARKB, and WisdomTree’s BTCW.
However, Tether’s accumulation remains smaller compared to the leading Bitcoin ETFs, such as BlackRock’s IBIT (which acquired 394,600 BTC), Grayscale’s mini Bitcoin trust (44,200 BTC), and Fidelity’s FBTC (27,900 BTC).
Ardoino’s data highlights a dual-pronged strategy: bolstering USDT reserves and building a longer-term Bitcoin investment portfolio via contributions to XXI.
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Tether’s Bitcoin Strategy
Tether initiated its formal Bitcoin accumulation strategy in May 2023, committing to allocate 15% of its quarterly net profits to Bitcoin purchases. This commitment established Tether as a prominent corporate entity with a consistent policy of directing profits into Bitcoin.
This strategy, however, hasn’t been without scrutiny. Recent claims made by YouTuber Clive Thompson suggested Tether sold over $1 billion worth of Bitcoin to finance a $1.6 billion gold acquisition, citing changes in the company’s publicly available asset disclosures.
Ardoino countered these claims, clarifying that the decrease in visible Bitcoin reserves resulted from transfers to XXI, not sales. He reaffirmed Tether’s commitment to a diversified reserve strategy encompassing Bitcoin, gold, and real estate.
Regardless of the ongoing debate, Tether currently possesses 100,521 BTC, with an estimated value of $11.36 billion at prevailing market prices.
Data from Bitcoin Treasuries positions Tether as the third-largest corporate holder of Bitcoin globally, surpassed only by MicroStrategy (recently rebranded as Strategy) and Block.one.