Tether is partnering with crypto lender Ledn to launch a gold-backed lending service later this year. The service will allow holders of Tether's XAUT token to borrow against their holdings, which are backed by a portion of Tether's $23 billion physical gold reserve. The offering mirrors Ledn's existing bitcoin-lending model and is part of Tether's broader strategy to expand beyond its core stablecoin business.
Gold-backed lending service
- ▪The partnership aims to allow tokenized physical gold to function as digital collateral, similar to how Bitcoin is used
- ▪The new service allows holders of Tether Gold (XAUT) to borrow against their holdings without selling the asset
- ▪Crypto lender Ledn is adding support for Tether Gold (XAUT) and the stablecoin USDT to its platform
- ▪Tether and crypto lender Ledn plan to offer gold-backed loans later in 2026
Tether Gold reserves
- ▪Tether is utilizing its $23 billion gold reserve by making its Tether Gold (XAUT) token available for lending on Ledn's platform
- ▪Tether has accumulated approximately 140 metric tons of physical bullion, making it one of the world's largest corporate gold holders
- ▪Each Tether Gold (XAUT) token represents one troy ounce of physical gold stored in vaults in Switzerland
Ledn collateral model
- ▪Ledn's 1:1 collateral model is designed to differentiate it from rivals that failed during the 2022 "crypto winter"
- ▪The new gold-backed loan service mirrors Ledn's established model for bitcoin-backed loans
- ▪Ledn states its client collateral is held 1:1 and is not lent out or used to generate yield
Tether business expansion
- ▪Tether is using profits from its USDT stablecoin to expand beyond its core business
- ▪Tether has invested in the precious metals marketplace Gold.com and partnered with financing firm Antalpha to expand XAUT's use
- ▪Tether has been reshaping itself into a technology group with divisions in finance, energy, and AI
- ▪Tether's other investments include bitcoin mining, renewable energy projects, and the AI infrastructure provider Northern Data
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