Tether to buy Bitcoin for stablecoin reserves using realized profits
USDT stablecoin issuer Tether will regularly buy Bitcoin for its stablecoin reserves using a portion of its profits starting this month as part of a new investment strategy, the firm announced Wednesday.
Tether said it will allocate up to 15% of realized investment profits – excluding any unrealized price appreciation of its reserve assets – to purchase BTC and will add the tokens to the reserve surplus.
The company will custody the BTC stash on its own, without using any third-party custodians, according to the statement.
Tether's BTC purchase campaign aims to strengthen and diversify the stablecoin reserves, while capitalizing on its price appreciation as an investment, the press release said.
The development comes after Tether revealed last week it holds $1.5 billion of BTC and $3.4 billion of gold among the assets that backs the value of USDT and its smaller stablecoins. That said, about 85% of the reserves are held in cash and cash-like assets such as US Treasury bonds, according to its 2023 Q1 attestation.
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