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Tether is shaking up the gold market with massive metal hoard
140 tonnes of gold is VERY impressive for a company like Tether. That's more gold held than by many small central banks - Philippines, Mexico, S Korea, Australia, Denmark, etc. Tether will be in Top 30 by gold held in the country list. https://en.wikipedia.org/wiki/Gold_reserve
This tariffs trade introduces uncertainty of who is friends vs foes. Confidence of the greenback and the federal deficit ($38.trillions) are called into questions. What can go wrong?
Agreed. I'd also add that no one should be particularly happy about the stratospheric rise of assets that appear to signal deep economic distrust.
Expert I am not! But I have read up a bit on a relatively new type of fund called momentum or trend following funds. They are somewhat deceptively categorized / called "managed futures" funds. These funds have a mandate to buy what's hot and sell what's not. As far back as 6 months ago I was aware most were chasing gold. I can't help wonder if these are big players in the metal's run-up. DBMF is one momentum fund I owned for several months last year and unloaded after what appeared a nice gain.. This one is +21% for one year and +6.45% YTD. There are many others. If you do some reading you will learn that gold is a thinly traded commodity, meaning large buyers and sellers can cause much greater price swings in both directions than for most investments.
Not intended to be investment advice. Congratulations to the winners. I expect that by now @rono has bought himself a lovely island somewhere in the Caribbean. Probably getting ready to dock his 80-foot cabin cruiser.
I am the first to admit I do not understand crypto or stable coins, but I assume the latter have to hold $1 in UST for every dollar value so as to always have a constant NAV.
If so where does Tether get the money to buy 70 tons of Gold? The interest on their $112 Billion UST stash would not begin to cover it
Tether purchases physical gold, totaling around 140 tons valued at roughly $24 billion, primarily using massive profits generated from its USDT stablecoin reserves, which are invested in U.S. Treasury bills. The company has been accumulating gold since 2020 to diversify its portfolio, buying directly from refiners and financial institutions.
Key sources of funds for Tether's gold acquisition include:
USDT Reserve Profits: As Tether's USDT stablecoin generates billions in interest from holding U.S. Treasuries, the company reinvests these profits into gold to diversify away from dollar-denominated assets.
Operating Revenue: With profits exceeding $10 billion annually, Tether uses its substantial cash flow to purchase gold, sometimes at a rate of 1 to 2 tons per week.
Tether Gold (XAUT) Backing: Some gold is acquired to back its own tokenized gold product, XAUT, which has a market capitalization over $2.6 billion.
Gold Mining Investments: Tether has also acquired stakes in gold royalty companies to generate cash flows that are converted into physical gold.
Tether, aiming to act as a "gold central bank," stores its gold in a high-security vault in Switzerland. "
someone tried to explain to genXYZ'ers that gold was like physical crypto. that cohort didnt know they would also get a bit of free fraud protection...or at least something they can make a run on.
Comments
Very interesting. This implies to me a lot of momentum that is not likely to fall off any time soon.
https://en.wikipedia.org/wiki/Gold_reserve
Warren Buffet once said, “You only find out who is swimming naked when the tide goes out.”
https://latimes.com/business/story/2026-01-02/some-warren-buffett-wisdom-on-his-last-day-leading-berkshire-hathaway
Not intended to be investment advice. Congratulations to the winners. I expect that by now @rono has bought himself a lovely island somewhere in the Caribbean. Probably getting ready to dock his 80-foot cabin cruiser.
@rono- (That would be especially me.)
If so where does Tether get the money to buy 70 tons of Gold? The interest on their $112 Billion UST stash would not begin to cover it
Tether purchases physical gold, totaling around 140 tons valued at roughly $24 billion, primarily using massive profits generated from its USDT stablecoin reserves, which are invested in U.S. Treasury bills. The company has been accumulating gold since 2020 to diversify its portfolio, buying directly from refiners and financial institutions.
Key sources of funds for Tether's gold acquisition include:
USDT Reserve Profits: As Tether's USDT stablecoin generates billions in interest from holding U.S. Treasuries, the company reinvests these profits into gold to diversify away from dollar-denominated assets.
Operating Revenue: With profits exceeding $10 billion annually, Tether uses its substantial cash flow to purchase gold, sometimes at a rate of 1 to 2 tons per week.
Tether Gold (XAUT) Backing: Some gold is acquired to back its own tokenized gold product, XAUT, which has a market capitalization over $2.6 billion.
Gold Mining Investments: Tether has also acquired stakes in gold royalty companies to generate cash flows that are converted into physical gold.
Tether, aiming to act as a "gold central bank," stores its gold in a high-security vault in Switzerland. "
someone tried to explain to genXYZ'ers that gold was like physical crypto.
that cohort didnt know they would also get a bit of free fraud protection...or at least something they can make a run on.