Stablecoin issuer Tether is expanding its presence in commodity lending, with billions of dollars already deployed in the sector, according to CEO Paolo Ardoino.
In an interview with BloombergArdoino said Tether has so far granted about $1.5 billion in loans to commodity traders, providing funding in cash and its USDt (USDT) stablecoin.
The company targets traditional commodity trading, including agricultural products and oil, and plans to increase its exposure. “We’re going to expand dramatically,” Ardoino said.
The lending activity falls under Tether’s recently launched trade finance unit — a business line that typically focuses on short-term loans used to facilitate the movement of goods through global supply chains. In the commodity world, trade finance typically provides the financing that traders need to purchase, transport and deliver cargo.
Bloomberg reported that some companies may be reluctant to borrow in US dollars instead of dollars, though that reluctance may be outweighed by Tether’s growing financial power. With nearly $184 billion worth of USDt in circulation, Tether is now among the most profitable companies in the world per employee.
Tether’s foray into commodities builds on its existing footprint in the sector. Its tokenized gold product, Tether Gold, has grown in size during the rise of bullion, and Ardoino recently he said the company owns more than 100 tons of physical gold.
Related: Tether’s stablecoin business is set for another record year of profitability
The stablecoin engine that powers Tether’s diversification
Tether’s rapid expansion into new business lines is rooted in the success of its stablecoin business. USDt was originally created to give crypto traders a dollar-linked asset at a time when the industry was struggling to access traditional banking services.
Since then, stablecoins have evolved into a major financial tool used for remittances, cross-border payments, and onchain settlement — prized for their speed, low cost, and 24-hour portability. That growth has turned Tether into one of the highest-grossing companies in the digital asset industry, allowing the company to diversify into trade finance, commodities, AI and other ventures.
Major financial institutions have also begun to explore stablecoin technology in various forms. JPMorgan continues to expand the use of its blockchain-based JPM Coin for institutional payments, while Citigroup has launched tokenized deposit and settlement pilots.
Payments giant Visa recently expanded its stablecoin settlement capabilities, allowing select companies to receive payments in USDC (USDC) under a new pilot program.
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