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Source: Forbes, Nina Bambysheva
During the period when FTX and other industry giants fell out, most of the cryptocurrency world fell into collapse. However, in this wave of storms, Tether was unique and showed a booming trend.
The market value of its stable currency USDT has soared to $ 111 billion, which is three times the USDC issued by Circle, headquartered in Boston.Due to the high interest rates of U.S. Treasury bonds, these Treasury bonds constitute most of their digital stable currency reserves. Tether is in an enviable position because its funding sources are actually free.Different from traditional banks, customers deposit hard currency into Tether in exchange for currency and will not get interest.
In the first quarter of 2024, Tether reported that the company’s “financial results” of the unveiled company were $ 4.5 billion and net assets were $ 11.4 billion.In 2023, the company’s net profit reported at $ 6.2 billion, which may be the most profitable company in the field of cryptocurrency today.Coinbase is the largest cryptocurrency exchange in the United States. With the annual revenue of US $ 3.1 billion in 2023, it only made $ 95 million. In the first quarter of 2024, due to the rise in cryptocurrencies, its net profit reached 12$ 100 million.Thanks to the cooperation with Circle, about 20% of Coinbase’s 2023 profit comes from interest obtained from its reserves that support stable currency USDC.
Tether, who holds sufficient funds, is now looking for growth opportunities other than stable coins.Last month, the company headquartered on the British Virgin Islands announced a strategic reorganization. In addition to stabilizing the currency business, it also expanded to three new departments: Bitcoin mining, artificial intelligence and education.
“The concept of removing middlemen in cryptocurrencies can be applied to many other things,” said Paolo Ardoino, the new CEO of Tether, saying that since 2017, he has been the company’s chief technical officer and spokesman.
Tether’s plan expansion is not only a prudent diversification strategy -it is also a philosophical idea.”We think 90% of technology, even more, is established for the best situation, but no one establishes technology for the worst case,” said 40 -year -old Ardoino.”If there is a disaster, I don’t say that there will be, but everything may happen, and we are not prepared for this.”
The historians of cryptocurrencies will remember that Bitcoin was founded by Satoshi Nakamoto after the financial crisis in 2008. At that time, the stability and credibility of the global financial system was widely questioned.Ardoino believes that Tether will play an important role in creating his sovereign technology, which can give people power.
Ardoino said: “It is a good thing to have elastic currency, but if you only have elastic currency and everything else is centralized, then it will be destroyed soon. One of our motto is‘ built for the end ’.”
Paolo Ardoino grew up in family farms in northern Italy.He started programming at the age of eight and later studied computer science and mathematics at Genoa University.After graduating in 2008, Ardoino became a military project researcher at Electronics and Information Technology Company Selex Communications, focusing on high availability elastic networks and encryption technology.
In order to find opportunities outside Italy, he moved to London in 2013, and soon founded FINCluster, a consultant, fund managers and institutions for London, Milan, and Lugano.In October 2014, one of his customers introduced him to Tether’s chief financial officer Giancarlo Devasini and his sister cryptocurrency exchange Bitfinex.Devansini invites Ardoino to help expand the Bitfinex platform, which has become more and more popular.
Ardoino was quickly assigned the technical departments of the two companies, and because Devasini and CEO Jean-Louis Van Der Velde avoided the public’s attention, Ardoino became the spokesperson for Tether.According to the Forbes Billionaire List, the three of them and the general legal adviser Stuart Hoegner later became billionaire.
In December last year, Ardoino officially took over Tether and retained his duties of his chief technical officer in Bitfinex.He also led the strategic work of Holepunch. Holepunch is a technical platform launched by Tether, Bitfinex and infrastructure platform Hypercore. It allows developers to create applications without the need of a server.
According to Ardoino, Tether’s ownership structure has not changed.Chief Financial Officer Devasini is still the largest shareholder of the company, and former CEO Van Der Velde still participates in the consultant.But this did not prevent Ardoino from planning a new direction for Tether.Last month, the company announced its reorganization into four departments to develop its expanding business focus:
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Financial sector, responsible for managing USDT and supervising the upcoming digital asset token platform;
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Data department, responsible for strategic investment in emerging technologies, including artificial intelligence and point -to -point platforms;
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Computing power department, focusing on Bitcoin mining and energy -related business;
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Education departments support education and leadership plans.
Tether has made significant progress in various fields.Last year, the stable currency giant participated in a US $ 1 billion investment in a Bitcoin mining business called “Volcano Energy”, although the business will use solar and wind energy power supply.Tether also established its own Bitcoin mine in Uruguay.In September last year, Tether revealed that it spent 420 million US dollars to buy 10,000 NVIDIA’s H100 graphics processing units (GPUS), which costs $ 420 million to buy in Germany. These GPUs are usually sought to process artificial intelligence companies that process large amounts of data.use.As a exchange, Tether received 20% of the company’s shares, and the company intends to rent these chips to AI startups.Tether’s other novel investment was made in April. At that time, it spent $ 200 million to buy a majority equity of BlackRock Neurotech, which was purchased by $ 200 million.Or paralyzed people can “think” to “eat, drink water, operate robotic arm and send email”.
According to Ardoino, Tether has doubled the number of streamlined employees in the past year to approximately 100, and he personally interviewed each candidate.”I don’t want to say ‘Yes’,” Ardoino said.”I hope people tell me their views on Tether, and where we do right and wrong.”
In terms of Bitcoin mining, Ardoino’s goal is to get a 5% market share, which will make it among the top global miners.”If you see Bitcoin as the ultimate currency form, you know that it is built for doomsday. You don’t want most Bitcoin mining in one country. Therefore, the way to achieve this goal is to invest in different regions in different regions”He explained.”We start from South America and plan to expand in different regions of the world to ensure that Bitcoin mining can continue to be decentralized.”
“In the competition in the field of Bitcoin mining, the real key is how much money you can invest. They have invested about 500 million US dollars. With this money, you can go far away,” H.C. WainWright analyst KevinDede indicated.Adam Sullivan, the CEO of Core Scientific, has added: “They are the largest investors in the field of Bitcoin mining. This is very suitable for them because this is the driving force for their business development.”Sullivan refers to the recent surge in Bitcoin’s price increase to Tether’s profits because Tether holds a large number of digital assets.If the price of Bitcoin continues to rise, mining Bitcoin will increase profits.
However, although Tether has made progress in Bitcoin mining, entering the field of artificial intelligence will face greater challenges.In addition to transactions with companies such as Northern Data, Tether also sought to establish a team of internal experts, build large -scale models, and integrate artificial intelligence functions into its existing products.The recruitment advertisements on its website list the positions of artificial intelligence engineers and the research and development supervisor of artificial intelligence.”I think artificial intelligence can play a greater role, and it is not very affected by the political prejudice of minority elites currently running the world’s largest artificial intelligence projects,” Ardoino refers to some companies including Microsoft, Openai and Google.They currently dominate most of the work of artificial intelligence.”We think artificial intelligence should get rid of middlemen, just like currency should get rid of the middlemen.”
Radical Ventures partner Rob Toews is skeptical of Tether’s so -called artificial intelligence.”It is a relatively easy strategy to buy GPU and rent it to an artificial intelligence company, but it is really difficult for me to imagine that Tether can become a trusted competitor in the world of multi -modal AI models.”
Through its educational branch, Tether will provide courses and seminars covering blockchain technology, artificial intelligence, coding and design.It has launched cooperation projects with Georgia Digital Industry College and Thailand’s largest local exchange Bitkub.”Education is the cornerstone of this journey, and the key to cultivating economic prosperity and sustainable development,” Ardoino said.
In view of the history of cryptocurrency turbulence and the fact that Tether has not yet issued a financial statement audited by a registered accountant, people’s concerns about their new investment funds are reasonable.According to the company’s financial proof, a large part of the profit of $ 4.52 billion in the first quarter came from the company’s benefits of Bitcoin and golden positions.Ardoino insists that Tether’s investment comes from its profit, not a customer reserve.
“If people think they start using customer reserve to invest in these things, Tether may collapse quickly,” said Austin Campbell, associate professor and blockchain company consultant of Columbia Business School.”I always say that Tether’s problem is not what they hold, but what they may hold in the future because they are not limited.”
Campbell also warns that Tether’s dominance in the field of stabilization currency is far from long -term guarantee: “With the introduction of the stabilization currency system and the regularization of regulatory supervision, Tether will have to start to comply with these regulations or leave these jurisdictions.”
Tether’s dominance has been challenged.Although according to DEFILLAMA data, USDT is still the leader of the stabilization currency market, accounting for 69% of its share, but it is behind the transaction volume.According to the analysis of the payment giant VISA and corporate blockchain data platform, ALLIUM Labs, Circle’s USDC’s trading volume in April 2024 was 178.6 million, surpassing 173.9 million USDT.
In addition, according to a recent report from the S & P Global Ratings (S & AMP; P Global Ratings) states that American Senator R-WY and Christen Geelybrand (D-NY)The new version of the cross -party stabilization currency bill proposed in April will limit the institutions that have no bank license to issue up to $ 10 billion in stablecoins, which may stimulate the competition of traditional banks.
“We believe that all these investment is crucial to Tether … We believe that these investment can change the fate of emerging markets and developing countries. We hope to become leaders in the process of human evolution.”
