Tether has quietly overtaken central banks in recent months to become one of the most aggressive gold buyers.
Given Tether’s aggressive commitment to the long-term future of cryptocurrencies, its aggressive move to gold has people wondering what prompted the change.
sponsored
Tether outbuys central banks
The record 56% jump in gold prices in 2025 is often attributed to concerns about fiscal dominance, rising public debt, loose monetary policy and declining confidence in major currencies.
These concerns are This has prompted central banks in countries such as Kazakhstan, Brazil, and Türkiye to increase their gold purchases. Reinforcing metals’ position as the world’s most trusted and secure assets.
But Jeffries’ recent analysis reveals a surprising development. Tether bought 26 tons of gold in the third quarter, more than any central bank. By the end of September, the company had a total inventory of approximately 116 tons, valued at approximately $14 billion.
Tether’s presence in the gold market far exceeds that of XAUt, a tokenized product with a market capitalization of $1.6 billion but holdings of less than 12 tonnes. Jefferies reported that the company is expanding its bullion reserves to support both USDT and XAUt.
According to Reuters, USDT’s circulation increased from $174 billion in the third quarter to $184 billion by mid-November. As supply increased, gold became a large part of its backing. Precious metals currently make up about 7% of Tether’s reserves, valued at about $13 billion.
sponsored
In total, Tether holds approximately 104 tonnes of gold for USDT and 12 tonnes for XAUt. The scale and consistency of these purchases highlights the company’s growing influence in the bullion market.
However, the timing of this rapid accumulation has created a new layer of controversy.
Movements contrary to the GENIUS law
Tether’s growing bullion position sits uncomfortably alongside the new US GENIUS law. This law prohibits compliant issuers from holding gold as part of their reserves. This has encouraged companies seeking approval to rely on cash, Treasury bills and other liquid, transparent assets.
Tether has already announced a GENIUS-compliant token called USAT, which bypasses gold completely. However, the company continued to add bullion to back USDT even after the law was passed.
sponsored
It is still unclear why Tether doubled in gold during this change. Gold prices have also been stagnant since hitting $4,379 in mid-October. The metal is currently trading more than 6% below its peak.
Still, Tether’s push into physical gold highlights a deeper convergence between cryptocurrencies and traditional safe-haven assets.
sponsored
Different shelter, different risk
The convergence of gold and Bitcoin, often referred to as “digital gold,” is not at all surprising. Both are attracting buyers concerned about the decline in major currencies. Many believe that assets with finite supply protect against long-term declines in land prices.
But in reality, the two markets behave quite differently.
Although Bitcoin has grown rapidly over the past decade, it remains volatile. Recent price movements have made this clear. The token has tumbled over the past two months, acting more like a high-beta technology asset than a financial hedge.
Stablecoins work based on different promises.
They provide immediate redemption at par and rely on reserves intended to remain stable. However, the crypto sector continues to show vulnerability to sudden stresses. Sudden changes in emotions can occur at any time.
If demand for a stablecoin were to collapse, it would put direct pressure on the underlying assets. That includes Tether’s ever-growing gold mine. A sharp reversal in the market could prompt a sell-off of bullion, drawing traditionally stable assets into the turmoil of a crypto-driven market.
