Tether’s Gold Rush: How the Stablecoin King Is Outbuying Central Banks

In 2025, central banks worldwide are driving an unprecedented gold-buying boom.

In the past year, the central banks of China, India, Poland, and Turkey together purchased over 1,100 metric tons of gold, setting a new record since the collapse of the Bretton Woods system.

Amid this wave of gold accumulation, a “non-sovereign” buyer is quietly emerging: Tether, the parent company of stablecoin giant USDT.

According to Bloomberg, Tether ranks among the world’s largest gold buyers. Its latest reserve report shows that as of September 2025, the company held gold worth more than $12.9 billion—exceeding the reserves of central banks in Australia, the Czech Republic, and Denmark and placing Tether in the global top 30.

What’s even more remarkable is the pace of its acquisitions. In the year ending September, Tether increased its gold holdings by an average of more than one metric ton per week, ranking third globally among central banks—behind only Kazakhstan and Brazil, and ahead of the central banks of Turkey and China.

This figure does not include the gold bullion reserves backing its gold stablecoin (XAU₮), nor the private gold investments funded by billions in profits.

Tether isn’t buying paper gold or ETFs—it’s acquiring actual gold bullion.

Unlike most central banks, which store gold at the Bank of England or the New York Fed, Tether has opted for privately constructed vaults and self-custody. CEO Paolo Ardoino revealed in an interview that Tether has constructed “one of the world’s most secure vaults” in Switzerland, though he declined to disclose the exact location.

TechFlow has learned that Tether is also building a second vault in Singapore to support its Asian reserve operations and expand its gold stablecoin, XAU₮.

Tether is replicating central bank hardware infrastructure by developing its own vaults and a globally distributed reserve system.

Recently, Tether took an even bolder step—recruiting top talent directly from the heart of the gold market.

Bloomberg reports that Tether has lured two globally renowned precious metals traders away from HSBC with lucrative offers: Vincent Domien, Global Head of Metals Trading, and Mathew O’Neill, EMEA Head of Precious Metals Financing. Both are currently completing their notice periods and are expected to join within months.

Domien also serves as a director of the London Bullion Market Association (LBMA), the de facto global standard-setter for the gold market. O’Neill, with HSBC since 2008, is a key figure in European precious metals financing.

On closer examination, it’s clear Tether is not simply buying gold—it has far greater ambitions.

From Bullion to Mines: Full Supply Chain Integration

If building vaults and stockpiling physical gold is Tether’s first move to mirror central banks on the asset side, its true ambition goes much further. Tether isn’t content to remain a passive buyer; it is integrating the entire gold supply chain into its financial ecosystem.

This blueprint consists of three layers: gold mining assets and royalties at the base, gold bullion in the middle, and tokenized on-chain gold at the top.

First, the most familiar: XAU₮, a gold standard embedded in smart contracts. Tether Gold (XAU₮) is a gold-backed token from Tether, with each token representing one ounce of physical gold held in Swiss vaults and meeting London Bullion Market Association (LBMA) “Good Delivery” standards.

Official data shows that XAU₮ is backed by over 370,000 ounces of physical gold—more than 11 metric tons—all stored in Swiss vaults. With surging gold prices, XAU₮’s circulating market cap now exceeds $2.1 billion.

Thus, Tether’s gold exposure is twofold:

First, the gold reserves on its own balance sheet, which reinforce the creditworthiness and risk resilience of the USDT stablecoin;

Second, the gold backing its XAU₮ token—this portion is restructured as an on-chain financial product.

For example, Tether launched the open finance platform Alloy by Tether, allowing users to use XAU₮ as collateral to mint new synthetic dollar stablecoins, aUSDT.

But Tether aims even higher, investing directly in upstream gold royalty companies to bring future mine production into its asset portfolio.

In June 2025, Tether Investments acquired equity in Canadian-listed Elemental Altus Royalties, a company specializing in gold and precious metals royalties and streams, with rights to several producing or near-producing mines.

Public records show that through a series of agreements and increased holdings, Tether could acquire more than a third of Elemental Altus’s shares. It would become a cornerstone shareholder. Tether also injected about $100 million to support its merger with EMX Royalty, helping to create a mid-tier gold royalty platform.

Tether isn’t just buying gold bars—it’s acquiring rights to future gold production.

And Tether’s engagement goes even broader. The Financial Times reports that Tether is in talks with multiple gold mining and investment companies, seeking to deploy capital across mining, refining, trading, and royalty income—building its own “gold industry matrix.”

Reportedly, Tether also held discussions with gold mining investment vehicle Terranova Resources. While no deal was reached, the intent is clear:

Tether wants to systematically integrate the entire gold supply chain—not just make financial investments.

Taken together, these elements reveal Tether’s gold strategy as a dual-pronged, top-down and bottom-up approach:

Top-down, it launches XAU₮ as a tokenized access point for global gold demand—establishing a “gold flow entry point” through financial products;

Bottom-up, it acquires bullion reserves, mining royalties, and potential mining investments—gradually bringing gold supply chain assets under its control through capital and equity participation.

What Drives Tether’s Gold Conviction?

At first glance, Tether’s gold strategy might seem like “gold FOMO”—buying safe assets alongside central banks.

But a closer look at executive statements and asset allocations over the past two years reveals a coherent asset philosophy—a defined worldview:

Bitcoin and gold together form a dual foundation of safety for the balance sheet of a stateless central bank.

CEO Paolo Ardoino often says he dislikes the “Bitcoin as digital gold” narrative, preferring instead to call gold “natural Bitcoin”—equally scarce and time-tested, with one existing in the physical realm and the other in the digital sphere.

In September 2025, Ardoino stated: “As the world grows darker, Tether will continue to invest part of its profits in safe assets like Bitcoin, gold, and land.” He believes Bitcoin and gold “will outlast any fiat currency” and are the ultimate stores of value through cycles.

As the XAU₮ promotional video puts it, for over 5,000 years gold has symbolized power, stability, and truth—measured by weight, not words.

This philosophy underpins Tether’s asset-side strategies over the past two years:

Tether’s quarterly audit reports reveal a heavy concentration in U.S. Treasuries—over $120 billion, making Tether one of the largest holders globally.

Since 2023, Tether has repeatedly stated in its announcements that it will allocate a portion of quarterly profits to “long-term value positions”—first Bitcoin, then gold. The aim isn’t to collateralize USDT 1:1, but to reinforce the company’s overall balance sheet with “hard assets,” hedging against interest rate, credit, and geopolitical risks.

Thus, Tether’s gold strategy is driven by several clear motives:

First—most straightforward—convert profits into assets no central bank can print.

During the high-rate cycle, Tether earned more than $10 billion annually from its massive Treasury holdings, with expected profits surpassing $15 billion in 2025. Ardoino knows this “spread feast” is cyclical, while sovereign debt expansion is structural.

Over the past year, he has repeatedly referenced the “devaluation trade”—investors wary of long-term depreciation of sovereign debt and fiat currencies shift assets toward hard assets like gold.

Second, hedge against extreme risks in the dollar system.

USDT is now as large as the currency of a small nation or a regional banking system, forcing Tether to contemplate extreme scenarios: if U.S. regulators or banks apply pressure or freeze assets, or if the dollar system faces systemic risk, reliance on Treasuries and bank deposits would be overly passive.

Gold is free from sovereign credit and, through privately constructed vaults, fully independent of traditional custodians—hence Tether’s choice to build vaults in Zurich and Singapore instead of storing gold at the Bank of England or New York Fed like most central banks.

Third—in the RWA era, gold is the most universally accepted off-chain asset.

In its Q1 2025 announcement, Tether explicitly called XAU₮ “one of the largest and most compliant tokenized gold products by market cap,” emphasizing every token is 100% backed by real gold bars in Swiss vaults.

This creates a robust closed loop:

On one side, Tether locks in both spot and long-term gold production via purchases and investments in companies like Elemental Altus. On the other, it tokenizes these holdings as XAU₮, making them globally tradable DeFi collateral and settlement assets.

From a business perspective, this is a DeFi-driven revaluation of the gold supply chain’s cash flow and worth.

Every asset allocation step by Tether resembles a company learning central banking.

Tether isn’t just chasing yield—it’s building a new order, bounded by code and anchored by gold and Bitcoin.

If the future evolves into a multipolar currency system, then “Treasuries + Bitcoin + Gold” will be more than an asset mix—it will be the resilient balance sheet of this stateless central bank.

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