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Gabor Gurbacs, a well-known figure in the cryptocurrency industry and the founder of PointsVille, recently shared his perspective on Tether's strategy and the role of precious metals.
In a statement made on May 12, 2023, he highlighted the increasing importance of gold for Tether Limited, the issuer of USDT.
Tether Gold-assets are around $3.4 Billion. XAUT AUM is around $500mm. Tether is now a precious metals powerhouse.
Don't underestimate the Tether team. High integrity and hard working team that supports Bitcoin, commodity technologies and financial inclusion. pic.twitter.com/0JPvNUk6n5
— Gabor Gurbacs (@gaborgurbacs) May 12, 2023
According to Gurbacs, Tether is becoming dominant in the precious metals market. With approximately $3.4 billion in reserves held in gold, the platform is establishing itself as a significant player in the precious metals sector.
Gurbacs also pointed out that Tether Gold (XAUT), the largest stablecoin pegged to gold and issued by Tether, is backed by around $500 million. This means that the proportion of gold in Tether’s reserves is 127% higher than that of Bitcoin (BTC), which only accounts for $1.5 billion of Tether’s holdings.
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Gurbacs believes that this combination of gold and Bitcoin serves as a robust hedge against potential market crises and unforeseen events.
It’s worth mentioning that Gurbacs holds an advisory position in Tether, as stated in his Twitter bio. In addition to his insights on Tether, he suggested that diversified portfolios should allocate 5-10% to gold, Bitcoin (BTC), and commodities.
Precious metals, in particular, are known for their relatively low volatility compared to other investment options available to retail and corporate investors.
Meanwhile, Tether’s market capitalization has nearly recovered from its losses due to the Terra (LUNA) collapse a year ago. Tether’s market cap currently exceeds $82 billion, just shy of its all-time high of $83 billion. Notably, according to its latest public reports, Tether Limited reported impressive profits of $1.5 billion in Q1 2023.