An overview of the 20 companies recently invested by Tether reveals the three major strategies of the "Digital Finance Empire."

Author: 100y.eth, Four Pillars

Compiled by: Felix, PANews

The continuous growth of USDT indicates that a massive digital financial empire is rising. This article will review the 20 companies recently invested in by Tether and discuss Tether's three major strategies for building a digital financial empire:

• Gain trust through Bitcoin and gold;
• Strategic expansion across major continents worldwide;
• Enhance the convenience of retail and institutional use through services and products.

Tether and the Digital Financial Empire

Currency and Empire

Source: Dyken Wealth Strategies

Currency is a universally accepted medium of exchange and unit of value in daily life. However, from the perspective of empires, the role of currency goes far beyond simple transactions; it can be seen as a tool of power, encompassing political, cultural, and social functions. Throughout the historical progression of empires, currency has also played the following roles:

• Symbol of Order: The figures or imperial emblems carved on the coins visually embody the authority of the empire, serving as a testament to the imperial order presented to the users.
• Tools of Control: By centralizing the minting and currency issuance powers, the remote regions become dependent on the central empire's monetary system, thereby reinforcing the imperial order.
• Standardization of resource concentration: The empire accumulates resources from various regions through taxes and tributes, while currency serves as the key medium for standardizing and transporting these resources.

Without exception, the status of currency always changes in sync with the status of the empire. When an empire rises and reaches its peak, its currency also becomes strong and supports the empire. When an empire declines, the status of its currency also decreases, thereby accelerating the empire's demise.

Although terms like “empire” or “colony” have long disappeared, we are far from free of the influence of these concepts. The US dollar accounts for about 57% of global foreign exchange reserves and about 50% of SWIFT international settlements, and its position remains solid.

Continuous Growth of USDT

Source: Artemis

With the development of information technology, a significant portion of the global economy has shifted to the internet. The emergence of blockchain technology has made it possible to securely use currency online. As the on-chain economy rapidly develops, stablecoins, which are currencies used on-chain, have also quickly expanded to a scale of about 300 billion dollars.

Among the many stablecoins, the one that deserves the most attention is Tether's USDT. USDT allows people in countries where many fiat currencies are extremely unstable to easily access US dollars. Even without a credit history or bank account, anyone with an internet-connected device can easily obtain US dollars. This has opened the door for the rapid development of USDT, especially in developing countries and third-world nations.

It is worth noting that, despite the passage of the “GENIUS Act” and the gradual inclusion of blockchain into regulatory mainstream, the market share of USDT has not significantly decreased. Its share remains above 60%, more than double that of the second-ranked USDC.

Towards a Vast Digital Financial Empire

Tether is building its vast empire with its USDT currency, but establishing an empire is no easy task.

Although USDT is pegged to the US dollar, its reserves include not only highly liquid cash equivalents such as cash, US Treasury bonds, and repurchase agreements, but also relatively less stable assets such as precious metals, Bitcoin, government bonds from countries outside the US, and corporate bonds. In major countries with established regulatory frameworks for stablecoins, such assets cannot legally be considered reserve assets.

In fact, under the European Union's regulatory framework of the Markets in Crypto-Assets Regulation (MiCA), USDT fails to meet several conditions for electronic money tokens (EMT). As a result, European exchanges have delisted USDT, effectively excluding it from the EU market.

But Tether has not given up. As a company, Tether acquires equity by investing in various startups and companies, and occasionally donates to non-profit organizations. Examining these actions, one can infer the direction chosen by Tether and how it tries to build a digital financial empire.

The following will outline Tether's investment cases to understand how it overcomes challenges in building an empire.

Tether What types of companies does it invest in?

Tether is a company that has garnered significant attention from the crypto community. This is not hard to understand, as Tether is the issuer of USDT, the largest stablecoin in the world, and is also one of the companies with the highest per capita income globally.

The crypto community seems to be deeply interested in protocols for token issuance supported by Tether. A typical example is Stable and Plasma, both of which are dedicated to USDT. However, these two projects are not directly funded by Tether but rather by related entities such as Bitfinex, USDT0, and Tether CEO Paolo Ardoino.

Although Tether is very active in corporate investments, most of the companies it invests in do not issue tokens and do not have strong regional characteristics, so these investments have not attracted much attention from the crypto community. Nevertheless, examining Tether's investment cases can still reveal the future direction of Tether's development.

What types of companies does Tether invest in?

After analyzing Tether's investment announcements for about a year and a half, the following key themes have been summarized:

• European Market: Although USDT has been expelled from the EU, Tether is attempting to enter the European market by investing in issuers and platforms within Europe.
• Emerging Markets: The product-market fit (PMF) of USDT has been validated in emerging markets. Tether is strategically expanding its influence in these regions.
• Retail Investors: Tether invests in various non-custodial wallet developers to ensure that retail investors can easily access USDT.
• Institutions: In addition to retail investors and emerging markets, Tether also invests in enterprise solution providers to help institutions access USDT more easily.
• Bitcoin: Tether continues to invest in BTC and the broader Bitcoin ecosystem.
• Gold: Tether views gold as an important geopolitical asset alongside BTC and accelerates the advancement of a dual-axis strategy centered on Bitcoin and gold.
• Future Technology: Tether not only invests in currency-related businesses but also in advanced technologies that contribute to human society.

These themes reflect the coherent strategic direction that Tether aims to build for its digital financial empire.

Indirect Entry into the European Market

StablR

Source: StablR

StablR is a Malta-registered stablecoin issuer compliant with MiCA regulations, issuing EURR pegged to the Euro and USDR pegged to the US Dollar. In addition to accepting investments, StablR also plans to use Tether's tokenization platform Hadron. Hadron is a SaaS platform designed to tokenize a variety of assets including stocks, bonds, commodities, and stablecoins, with robust capabilities to support token lifecycle management, KYC, AML, monitoring, and other regulatory compliance infrastructure.

Quantoz

Source: Quantoz

Quantoz is a stablecoin issuer compliant with MiCA regulations, offering EURQ and EURD pegged to the euro, as well as USDQ pegged to the US dollar. EURD is specifically designed for closed systems, making it a more universal stablecoin compared to EURQ. Quantoz also plans to use Tether's Hadron tokenization platform.

Bit2Me

Source: Bit2Me

Bit2Me is the largest digital asset platform in the Spanish-speaking world. Individuals, businesses, and institutions can trade and invest in various cryptocurrencies and participate in various financial activities such as remittances, payments, and lending. Founded in 2014, Bit2Me has been operating for over a decade and has more than 1.2 million users. Bit2Me operates under MiCA compliance and holds a CASP license, making it a strategically significant investment for Tether.

Targeting Emerging Markets

Parfin

Source: Parfin

Parfin is an institutional blockchain infrastructure company based in Latin America. Parfin offers a management and workflow platform that enables financial institutions to adopt blockchain technology and cryptocurrencies, providing secure MPC wallet solutions and asset tokenization services. Parfin has also received investments from venture capital firms such as Framework, Valor, Accenture, and ParaFi. By investing in Parfin, Tether aims to help financial institutions in Latin America more easily use USDT.

Kotani Pay

Source: Kotani Pay

Kotani Pay is a Web3 payment infrastructure company headquartered in Africa, offering services such as deposits and withdrawals, stablecoin settlements and payments, and blockchain wallets. By investing in Kotani Pay, Tether plans to expand the deposits and withdrawals infrastructure in the African region, making it easier for African users to access USDT.

Shiga

Source: Shiga

Shiga is a blockchain financial solutions company headquartered in Africa, providing a variety of blockchain services including exchanges between local currencies and stablecoins, over-the-counter trading, corporate virtual accounts, corporate fund management, and blockchain solution development. These services enable individuals and businesses across Africa to access the dollar economy through on-chain finance. Tether has stated that it views Africa as a key region for the adoption of USDT and is investing in Shiga to actively expand the African market.

Sorted

Source: Sorted

Sorted is a wallet solutions company headquartered in Africa and South Asia, offering a non-custodial wallet that can run smoothly on basic phones and low-end smartphones. This greatly increases the financial access channels for impoverished or unbanked populations. Users of Sorted can make cryptocurrency remittances, payments, and exchanges. By investing in Sorted, Tether can also expand its influence in Africa and South Asia.

Kem

Source: Kem

Kem is a widely used cryptocurrency remittance, payment, and financial management application in the Middle East. Users can use their crypto assets for remittances and payments within the Kem app, and can also link it to physical cards, and even invest in assets like gold. Like Africa and Latin America, the Middle East has a large number of foreign workers, so USDT-based crypto remittances can greatly stabilize their lives. Tether plans to expand USDT's market share in the Middle East by investing in Kem.

CityPay

Source: CityPay

CityPay is a cryptocurrency payment company headquartered in Georgia. In addition to Georgia, it is actively expanding its business in Eastern Europe, including Armenia, Azerbaijan, Kazakhstan, and Uzbekistan, by providing wallet services, issuing payment cards, and acquiring cryptocurrency payment merchants. By investing in CityPay, Tether aims to strategically secure USDT's market share in the payment sector of Eastern Europe.

Retail Strategy

The aforementioned Sorted and Kem are also non-custodial wallet solution companies that can be included in retail strategies.

Fizen

Source: Fizen

Fizen is a consumer-oriented crypto super app. Users can store, transfer, and use cryptocurrencies for payments through a self-custody wallet, while Fizen provides features such as payments, shopping, and gift cards, allowing users to integrate cryptocurrencies into their daily lives. By investing in Fizen, Tether aims to provide users with a high-quality USDT experience, enabling USDT to be widely used for everyday payments.

Be Water

Source: Be Water

Be Water is a media and content company headquartered in Italy, engaged in film, television, and documentary production and distribution, and also operates a news brand. Tether invested 10 million euros to acquire 30.4% of Be Water's shares, allowing Tether to establish a foothold in the global content ecosystem beyond the financial sector.

Zengo

Source: Zengo

Zengo is a wallet solution based on Multi-Party Computation (MPC) that allows users to securely use self-custody wallets without the need to manage complex mnemonic phrases. By investing in Zengo, Tether enables users to more safely store, send, and use Tether-based assets for payments.

Institutional Strategy

Parfin is also a company that provides services for financial institutions in Latin America, and can therefore be included in institutional strategies.

Crystal Intelligence

Source: Crystal Intelligence

Crystal Intelligence is a blockchain intelligence company engaged in fraud detection, risk monitoring, real-time wallet address analysis, regulatory support, illegal fund tracking, and crime response. By investing in Crystal Intelligence, Tether strengthens its collaboration with Crystal Intelligence and enhances its ability to prevent USDT from being misused for illegal activities. This is an important strategic investment for the development of USDT as an institution-friendly stablecoin.

Bitcoin Investment

Ledn

Source: Ledn

Ledn is a Bitcoin-collateralized lending platform that allows individuals and businesses to borrow stablecoins using Bitcoin as collateral. Tether has been committed to building the infrastructure that connects crypto assets with real financial use cases, and because Ledn is pioneering a new financial market based on Bitcoin, Tether has invested in it.

Adecoagro

Source: adecoagro

Adecoagro is the largest sustainable agriculture and renewable energy company in South America, listed on the New York Stock Exchange. Adecoagro sells part of its self-generated electricity on the spot market, but due to severe price fluctuations, the income can be unstable. From this perspective, Bitcoin mining can serve as a stable buyer of electricity. Tether plans to acquire up to 70% of Adecoagro's shares and jointly promote a Bitcoin mining project.

BTCPay Server Foundation

BTCPay is an open-source payment processor for Bitcoin and stablecoins. Its uniqueness lies in its self-hosted model, allowing users to run it directly on their own servers. Tether has supported BTCPay for two consecutive years to strengthen the infrastructure for censorship-resistant payments using Bitcoin and USDT.

OpenSats

Source: OpenSats

OpenSats is a U.S. 501©(3) nonprofit organization dedicated to funding Bitcoin and anti-censorship technologies. OpenSats operates a sustainable model to support the Bitcoin open-source ecosystem, with donations used to fund Bitcoin protocol development, privacy tool development, research, and education. Although this is not an investment, Tether has been donating to OpenSats, demonstrating its ongoing support for Bitcoin and the open-source ecosystem.

(# Gold as a Geopolitical Asset

Elemental Altus Royalties

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Source: Elemental Royalties

Elemental Altus Royalties is a company related to gold mining, but it does not directly mine gold. Instead, it generates revenue by entering into licensing agreements with gold mining companies. Tether views gold and Bitcoin as the infrastructure of digital currency and has acquired a 31.9% stake in Element Altus Royalties to strengthen its gold-related strategy.

Alloy

![])https://img-cdn.gateio.im/webp-social/moments-48585e86e421b49964cb96869ad672d9.webp###

Source: Alloy

Alloy is a service directly launched by Tether, rather than an investment company, but it is mentioned here because it plays a key role in Tether's gold-related strategy. Tether offers a gold token service called XAUT, while Alloy issues aUSDT, a gold-backed stablecoin that is collateralized by XAUT. This is an attempt to recreate the gold standard and is also a move by Tether to strengthen its strategy involving gold and Bitcoin.

Related reading: The Golden Empire of Teda: The Ambitions and Fractures of a “Stateless Central Bank”

(# Future Technology Investment

Blackrock Neurotech

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Source: Blackrock Neurotech

Blackrock Neurotech is a company in the field of brain-machine interfaces, founded by a research team from the University of Utah. The technology developed by the company implants electrodes in the brain, converting thoughts into digital signals. Those who are mobility-impaired, lack sensory function, or face communication barriers can significantly improve their quality of life through Blackrock Neurotech's technology. With this investment, Tether became a major shareholder, indicating its ambitions extend beyond the financial sector to advanced future technologies built for humanity.

) Conclusion

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Source: Tether

Tether holds $135 billion in U.S. Treasury bonds, ranking 17th globally, surpassing South Korea. In fact, Tether has built a digital empire with its currency USDT.

Through companies recently invested in by Tether, one can observe its strategy for building a digital empire.

• Earning Trust: Tether aims to earn user trust through the two major assets of Bitcoin and gold.
• Global Expansion: Tether aims to cover major continents around the world, including Asia, Africa, South America, Europe, the Middle East, and recently entered the US market through USAT.
• Increase Accessibility: Tether is committed to enabling retail, businesses, and institutions to easily use USDT in both daily and financial activities through various services.

Some have predicted that as blockchain regulation becomes increasingly strict, the status of Tether and USDT would be weakened, but this prediction has proven to be incorrect. The US-centered stablecoin industry will continue to grow, and the influence of Tether and USDT will accelerate.

Related Reading: Exclusive Interview with Tether CEO: The “Genius Act”, Circle IPO, Bitcoin, and Tether's Trillion-Dollar Market Cap