Tether CEO Paolo Ardoino said in an interview that the company is currently very cash-rich thanks to interest rate policies in the past few years. In addition to its asset reserve, the company will flex its muscles in the investment arm this year. And their investment goals will not be limited to blockchain. They will enter the AI industry, aiming to compete with Web2 giants such as Microsoft and Amazon and create a more decentralized AI industry environment.
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ToggleFor non-traditional investors, decentralized AI and brain-computer privacy will be the focus.
Paolo Ardoino said in an interview that the company had a surplus of US$11.9 billion in the past 24 months, part of which will be used as asset reserves, and the rest will be invested in the investment department. He said that the company will bring the decentralized spirit of Bitcoin into the AI industry. They believe that it is very important to have participants in the AI industry that are independent of giants such as Microsoft, Amazon, and Google. At the same time, Paolo Ardoino also mentioned Brain-Computer Interface. He believes that this technology is also a future trend. But the focus of development is on privacy, ensuring that data is stored on the individual and cannot be accessed by any company that controls social media. Paolo Ardoino also pointed out that they are not a traditional venture capital institution that wants to capture unicorns that can earn 100 times the profit. For them, projects that share their vision are even more important.
The asset reserve is very sufficient, Tether: 90% of profits will be reinvested
For Tether, having money but not knowing how to spend it may be a sweet worry. The company's second-quarter accounting report last month showed that revenue hit a new high, net profit in the first half of the year was US$1.3 billion, and it is expected to become the largest holder of short-term U.S. debt next year. How to invest in the investment market has also become a focus. Paolo Ardoino said that the stable currency business will always be given priority and risk management is the most important. The current reserves are very abundant, but if the issuance of USDT continues to expand, the reserves will also increase proportionally. Currently, 90% of the income will be invested in ecological development.
Why should the business nature be similar but should not be subject to bank regulations? Tether: We are safer
In the interview, Paolo Ardoino also talked about regulatory issues. For example, Tether’s business nature is basically very similar to that of banks. Why shouldn’t it be subject to the same supervision as banks? Paolo Ardoino said that banks will lend out 90% of the assets on their balance sheets, which means that the bank's mortgage ratio is only 10%. For comparison, Tether’s excess reserves are 105%.
In fact, Tether is not completely free of "partial guarantees". According to previous reports , Tether is operating a lending agreement with institutions and is a business of lending legal currency against cryptocurrency. As of press time, Tether's transparency report still shows 5.55% of secured loans, about $5.9 billion; Bitcoin reserves are 4%, which may also be collateral.
Talking about the difficulties Tether faces in Europe and whether it will withdraw from the European market. Paolo Ardoino said that the company is formulating a European market strategy. MiCA strictly limits the issuance of non-euro currencies such as USDT in order to prevent the US dollar from becoming the main currency in Europe. In addition, MiCA regulates USDT's reserve cash to be at least 60%, and banks can lend 90% of it. This means that issuing 10 billion euros of cryptocurrency would require depositing 6 billion euros in cash in banks, of which 5.4 billion would be lent. The actual reserves of 10 billion cryptocurrency are only 600 million. Paolo Ardoino said that this is very dangerous for banks and stable currency issuers. He believes this is creating additional systemic risks rather than reducing them.
