Tether Announces Plans To Invest Up To 15% Of Profits In Bitcoin, Bitcoin Price May Rise

On May 17, 2023, Tether, which issues the stablecoin `` Tether (USDT) '', announced plans to invest up to 15% of its net profits in Bitcoin from the same month. Tether describes the Bitcoin purchase as an “investment to diversify its reserves.”

Tether to Further Strengthen Reserves Through Purchase of Bitcoin with Realized Net Operating Profits | May 17 2023

Tether buys bitcoin with net profit to back USDT stablecoin

Tether Bought $1.5 Billion Bitcoin, Will Buy More – Trustnodes

Tether, which manages and operates the reserves of Tether, a stablecoin pegged to the US dollar, today announced that it will devote 15% of its net profits to Bitcoin purchases to diversify its reserves. showed an idea.

Tether will only purchase bitcoin at a fraction of the company's overall profit, with most of the excess profit going towards operating costs, including bank fees.

A spokesperson for Tether told the media, ``The value of Bitcoin in the portfolio is significantly below the $2.48 billion (approximately 340 billion yen) surplus reserve recorded at the end of the first quarter of 2023. The goal is to keep it,” he said.

Tether's market capitalization at the time of writing is $ 82 billion (about 11.27 trillion yen), which is the largest stable coin. In addition, Tether said that ``85% of the reserves that support the value of Tether are occupied by highly liquid assets such as cash and US government bonds,'' and that ``reserves have so far amounted to $ 1.5 billion (about 200 billion Yen) equivalent bitcoin', but it is said that the additional bitcoin purchased with 15% of the profit will be treated as a surplus reserve, not the backing of the tether.

“The decision to invest in the world’s first and largest cryptocurrency is underpinned by the strength and potential of Bitcoin as an investment asset,” said Paolo Ardoino, Chief Technology Officer at Tether. The coin continues to prove its resilience and is emerging as a long-term store of value with significant growth potential.Investing in Bitcoin will enhance the performance of our portfolio. It is also a way to work with innovative technologies that have the potential to change the way we do business and live.”

In the first quarter 2023 guarantee report announced in May 2023, Tether reported that net profit reached $ 1.48 billion (about 200 billion yen), 15% of which was 222 million. 10,000 dollars (about 30 billion yen). Tether's net profit will fluctuate depending on future performance, but assuming that the latest performance continues in the future, Tether will generate up to about $222 million per quarter and about $70 million in bitcoin (about 10 billion yen) every month. ) will be calculated to buy more.

News media CNBC said, ``This move will make Tether an even bigger holder of Bitcoin, and Tether will use a large amount of virtual currency, etc., based on the idea that ``tokens will not be affected by currency depreciation or inflation.'' Analysts and investors have previously warned that CNBC's 2023 Bitcoin price could be affected by the so-called ' whales ,' market participants with huge financial power. is likely to gain momentum,' he said.

Trustnodes, which deals with news related to digital finance, also said, ``While Tether's purchases are not huge, they will add new, ongoing demand pressure that could tip Bitcoin towards a more bullish bias. There is,' he analyzed.