Tether, known for its USDT stablecoin, has recently made headlines with its Bitcoin holdings soaring in value, generating a profit exceeding $1 billion.
Notably, this significant financial gain can be attributed to the stablecoin issuer’s approach of buying Bitcoin using a portion of its net profits. This move has proven highly lucrative amid the recent surge in BTC prices.
According to reporter Wu Blockchain, Tether’s holdings currently stand at 57,576 BTC, valued at an estimated $2.4 billion. These holdings were acquired at an average rate of $22,480 per BTC, reflecting a savvy investment strategy in the volatile crypto market.
Tether’s holdings of BTC currently have a profit of $1.1 billion (+85%). Tether currently holds a total of 57,576 BTC ($2.4B), with a cost of $22,480 per bitcoin. Among them, 53,492 BTC were reserved before March this year, and 4,083 BTC were purchased regularly using 15% of…
— Wu Blockchain (@WuBlockchain) December 5, 2023
The recent surge in Bitcoin’s value, which has surpassed the $41,000 mark, has been a major contributor to Tether’s significant profit margin, showcasing the potential of strategic crypto investments.
BTC Accumulation And Market Impact
The notable profit realized by Tether is the result of its investment strategy implemented in May 2023. The company began allocating up to 15% of its net realized operating profits towards Bitcoin purchases.
This strategic decision has not only diversified Tether’s investment portfolio but also aligned the company with Bitcoin’s potential as a “transformative” technology, according to Tether’s CTO Paolo Ardoino.
Paolo Ardoino noted that the choice to invest in Bitcoin was based on its decentralized nature, limited supply, and growing global adoption. Ardoino emphasized Bitcoin’s “resilience” as a “long-term store of value” and its potential to reshape business and lifestyle paradigms.
The Tether CTO stated:
Our investment in Bitcoin is not only a way to enhance the performance of our portfolio, but it is also a method of aligning ourselves with a transformative technology that has the potential to reshape the way we conduct business and live our lives.
As of the first quarter of 2023, Tether’s BTC reserves were valued at around $1.5 billion, a testament to the success of its Bitcoin accumulation strategy.
Bitcoin Rains Profits
The ongoing bull run in the crypto market has benefitted Tether and other prominent Bitcoin proponents. Max Keiser, a well-known trader and BTC supporter in the crypto community, recently revealed a significant surge in his Bitcoin holdings on X.
— Max Keiser (@maxkeiser) December 4, 2023
Keiser, who has been investing in Bitcoin since 2011, recognized the potential of BTC early on. While Keiser has not publicly disclosed the exact amount of BTC he owns, it’s clear that his early investment has paid off handsomely over the years.
Featured image from iStock, Chart from TradingView