Tether, the world's largest stablecoin issuer, now holds approximately 154 tonnes of physical gold worth around $20 billion at current prices, positioning it as one of the largest private gold holders globally. If ranked among central banks, this hoard would place it just outside the top 20, underscoring Tether's unique financial footprint.
Gold-backed lending and tokenization
On June 18, lending platform Ledn announced it would accept Tether's tokenized gold, XAUT, as collateral. Users can now take out USDT-denominated loans backed by XAUT, which represents direct ownership of physical gold. Of Tether's total gold reserves, roughly 132 tonnes back USDT, while the remaining 22 tonnes directly support XAUT, giving the token a 54% share of the tokenized gold market.
XAUT enables 24/7 on-chain settlement and can be deposited into crypto lending platforms in a single transaction without intermediaries. Unlike gold ETFs, which face margin-loan restrictions and limited trading hours, XAUT functions as collateral within the same ecosystem as USDT.
Challenges and audit timeline
Key loan terms such as loan-to-value ratios and liquidation thresholds remain undisclosed, and residents of Canada and the EU are excluded from using the service. On the audit front, Tether expects a full audit by a major accounting firm to be completed by April 2027.
While the gold infrastructure is now in place, the real test will be whether sufficient demand emerges for gold-backed borrowing. Tether's growing gold holdings and the expansion of XAUT use cases signal a deepening integration of traditional reserve assets with decentralized finance.