With $140 billion in stablecoins under its control and $7 billion in excess reserves, the crypto giant Tether is reportedly splashing cash on everything from AI to right-wing media. Flush with over $13 billion in profit from its US Treasury holdings, the company is on a mission to plant its flag beyond crypto and deepen its ties to the political elite now that Donald Trump is back in the White House.
At Tether’s annual Plan B Forum in El Salvador’s capital last week, CEO Paolo Ardoino made it clear that the company’s relationship with “the establishment” had changed dramatically. The crypto industry felt the heat of regulators for years, and USDT has been a prime target, accused of enabling shady transactions and lying about its reserves.
But things look different now, with Trump’s administration stacked with crypto allies. Paolo beamed as he addressed a sellout crowd: “We have been hugged by the establishment… Now they have embraced us.”
Trump’s return triggers a flood of Tether investments
Tether is using its political connections to ramp up investments across industries, including a $775 million stake in right-wing video platform Rumble. The deal is the stablecoin issuer’s second-largest ever, and it came together through its close ties to Howard Lutnick, CEO of Cantor Fitzgerald and Trump’s commerce secretary.
Howard’s son, Brandon, played matchmaker, introducing Ardoino to Rumble’s CEO Chris Pavlovski in the Bahamas. Cantor Fitzgerald also helped manage Tether’s reserves and holds a convertible bond issued by the stablecoin giant.
Howard himself was under scrutiny as part of his Senate confirmation process, with lawmakers questioning whether his relationship with Tether crossed ethical lines. Democrats on the Senate Commerce Committee pointed to a Wall Street Journal report that alleged Tether CFO Giancarlo Devasini had privately claimed Howard would “defuse threats” facing the company. Howard has denied making any promises, saying that he “never suggested anything improper.”
Paolo also denied expecting favors from the administration. Still, his firm’s political connections are impossible to ignore, especially with David Sacks, Trump’s AI and crypto czar, who also owned shares in Rumble before stepping down from its board just a week before Tether announced its investment.
Billions of excess cash fuel shopping spree
Over the past year, Tether has dramatically expanded its investment portfolio, which started with traditional blockchain investments like its stake in German crypto-tech company Northern Data AG, but quickly veered into other sectors.
Satellite imagery firms, brain-implant companies like Blackrock Neurotech, and even agricultural projects in South America have all secured funding from the USDT issuer. In just three months, its excess reserves grew by $1 billion, larger than most venture capital funds.
Tether holds $94.5 billion in US Treasury bills to back its stablecoin USDT. Paolo has been saying Tether is lobbying US lawmakers to prove how its stablecoin indirectly supports the dollar’s global hegemony.
But the company knows that its reliance on US Treasury yields won’t last forever, especially if interest rates drop or competitors launch better-regulated stablecoins. To hedge against those risks, the USDT issuer is expanding aggressively, kind of similar to how Saudi Arabia uses its oil wealth to secure its economic future.
Paolo confirmed that Tether has pitched blockchain-based tokenization projects to governments, including a proposal in Turkey to create tokens representing borate minerals.
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