- Tether is raising $200 million with Antalpha to build a digital treasury focused on its gold-backed token XAUt.
- The move comes as gold prices surge and demand for tokenized real-world assets grows among investors.
Tether Holdings is raising at least $200 million in order to form a tokenized gold-oriented public investment vehicle. The developer of USDT, the world’s largest stablecoin, is collaborating with Antalpha Platform Holding to develop a gold-backed token treasury called XAUt, according to a report by Bloomberg.
It represents a significant step toward the real-world tokenization of assets. Antalpha, a financial services company with connections to mining equipment manufacturer Bitmain Technologies, will be a partner in the project alongside Tether. Cohen & Co. is leading a fundraising exercise as an advisor.
The collaboration is a union of two giants in the cryptocurrency industry. Tether controls the dominant position in stablecoins through USDT, while Bitmain produces the majority of global mining hardware. They have joined together to create a new standard of gold investing in digital markets.
XAUt Gains Momentum Amid Rising Gold Prices
XAUt was introduced in 2020, indicating possession of physical gold bars stored in secure vaults. Each token is backed by one troy ounce of gold. The asset has gained popularity due to record-high gold prices.
The demand for gold has increased 46% this year. The fear of inflation and the resultant geopolitical tensions continue to drive investors toward safe-haven assets. The valuable metal has continually hit new all-time highs in recent months.
Tether and Antalpha recently launched XAUt-backed secured loan services. The companies intend to install the vault facilities in the key financial centres. The locations will allow token holders to redeem their digital assets for physical gold.
Tether CEO, Paolo Ardoino, emphasised gold’s importance during periods of economic uncertainty. He referred to XAUt as the optimal method for moving, holding, and trading gold during unstable markets.
Treasury Model Follows Industry Trend
The gold treasury vehicle is no exception to the pattern followed by other digital asset companies. There are over 80 other treasury companies that have emerged this year. Reverse takeovers, also known as special purpose acquisition companies, have been used by many to acquire public listings.
Tether had a past partnership with Cantor Fitzgerald and SoftBank to start a Bitcoin treasury fund, Twenty-One Capital. The firm is also engaging in an independent round of fundraising of up to $20 billion towards its main stablecoin operations. That initiative makes Tether worth about half a trillion.
The gold project enables Tether to expand its dollar-pegged stablecoin. It is also a way to safeguard against cryptocurrency market volatility. ARK Invest has expressed interest in purchasing a stake in Tether at the current price.
Tether recently added a US-based stablecoin, the USDT, to its product line and appointed Paolo Ardoino as its chief executive. The company maintains its presence across various categories of digital assets.
