Tether Explores New Opportunities in the Commodities Trading Sector
Tether, the issuer of stablecoin USDT, is currently looking into lending options for commodities trading firms. The company is in the early stages of exploring this possibility and has already begun discussions with several firms regarding US dollar lending opportunities.
Tether CEO Paolo Ardoino stated that the company is not disclosing the amount they intend to invest in commodity trading, as they are still in the process of defining their strategy. However, Ardoino emphasized that the opportunities in this sector are massive and Tether is keen on exploring different possibilities.
Cryptocurrencies are gradually making their mark in commodities trading, offering benefits such as transparency, security, and efficiency. While major players in the industry have access to extensive credit networks for trade financing, smaller firms often face difficulties in securing financing. Tether’s proposal aims to streamline and expedite payments and trades, potentially bypassing the strict regulatory conditions imposed on traditional lenders.
Tether is confident in its ability to participate in this venture, as the company reported a significant profit of $5.2 billion in the first half of 2024. Additionally, its native stablecoin USDT has experienced remarkable growth and maintains a dominant position in the stablecoin sector, with a market capitalization nearing $120 billion.
The use of USDT has also gained traction in countries like Russia and Venezuela for cross-border transactions. In fact, top Russian metals producers have started using USDT to settle transactions with their clients. The commodities trading industry faced challenges due to price volatility following Russia’s invasion of Ukraine, which strained liquidity but also generated record profits. This event highlighted the industry’s reliance on the US dollar and led to an increase in unregulated financing methods, such as the use of stablecoins in trade transactions.
To capitalize on the growing demand and trend, Tether has assembled a team to explore trade finance opportunities. Additionally, the company is expanding its focus on artificial intelligence (AI), as previously announced in March.
As Tether continues to explore new horizons, it remains committed to providing reliable and accurate information in the dynamic world of digital assets.
