Tether is expanding the use cases for its tokenized gold business. The company has integrated Tether Gold (XAUT) into the crypto lending platform Ledn and plans to launch a loan service using XAUT as collateral later this year, allowing users to obtain liquidity without selling their gold.
XAUT will be added to Ledn's collateral pool.
Ledn stated that the platform has begun supporting XAUT, adding it to the list of supported assets alongside Bitcoin and USDT. XAUT-based lending is scheduled to launch later this year.
For Tether, this means its gold reserves are no longer just used to back token issuance, but are also entering the lending arena. For holders, the uses of XAUT have expanded from holding and exchanging to collateralized financing.
Tether says it holds approximately $23 billion in gold.
According to Tether, the company currently holds approximately $23 billion worth of physical gold to support the circulation of XAUT. This amount is approximately 140 metric tons, making it one of the world's largest holders of gold.
Traditional gold-backed financing is typically dominated by central banks, large financial institutions, or precious metals dealers. Tether and Ledn are attempting to bring this type of business to an on-chain asset system, allowing tokenized gold to become digital collateral that can be directly used for financing, just like Bitcoin.
- Each XAUT corresponds to 1 troy ounce of gold.
- The physical gold is stored in a Swiss vault.
- Tether says its gold reserves are worth approximately $23 billion.
The lending model is modeled after Bitcoin mortgage loans.
Ledn has been offering Bitcoin-backed loans for the past few years. The company states that customer collateral is held 1:1 and will not be re-lent or used to generate yield. This statement is intended to distinguish it from the many lending platforms that collapsed during the 2022 crypto market crisis.
Tether CEO Paolo Ardoino stated that as digital assets play an increasingly important role in the global economy, market demand for products that balance long-term holding with financial flexibility is growing.
In addition to its gold business, Tether has been expanding its investments in recent years, including in Bitcoin mining, renewable energy, and AI infrastructure company Northern Data. Previously, Tether also invested in precious metals trading platform Gold.com and partnered with crypto finance company Antalpha to promote the use of XAUT in lending and physical redemption scenarios.
