Tether, the issuer of USDT, plans to allocate more than $1 billion to distribute among startups from “hundreds of venture proposals,” CEO Paolo Ardoino revealed in an interview with Bloomberg.
According to the executive, the firm is focused on alternative financial infrastructure for emerging markets, artificial intelligence, and biotechnology. Over the past two years, Tether has already invested approximately $2 billion in these areas.
“Our policy is to support only those projects that we find extremely interesting,” commented Ardoino.
He noted that Tether is not seeking companies that need to achieve certain profitability metrics in the next one to two years, distinguishing it from traditional venture funds.
Tether invests a significant portion of the reserves backing USDT in U.S. Treasury bills and other securities, earning billions of dollars in profits amid current high rates.
In the first quarter of 2024, the firm’s net profit reached $4.2 billion. About $1 billion was earned from operational profits, primarily as interest income from U.S. Treasury obligations. The remaining net profit (~$3.5 billion) — came from the appreciation of positions in bitcoin ($3.65 billion) and gold ($5.7 billion).
Ardoino stated that the company plans to maintain 100% of its reserves, along with an additional “cushion” of 6% profit, to ensure the seamless redemption of USDT. The remainder will be directed towards deals.
To expand its distribution network, Tether is investing in infrastructure in emerging markets. Additionally, the USDT issuer has already invested over $1 billion in artificial intelligence, notably supporting data center operator Northern Data Group.
The CEO of Tether reiterated plans to launch a platform by the end of this year, where companies can issue bonds and stocks in the form of digital tokens, and central banks can offer CBDCs.
In April, Tether announced a restructuring into four divisions to venture into areas beyond stablecoins.