Tether has made over $10,000,000,000 in net profit for 2025, much of it stemming from gold appreciation rather than bitcoin. As gold prices hit record highs above $5,300 this week, Tether significantly increased its gold holdings—its gold-backed token (XAUT) supply now grows faster than its flagship USDT, with CEO Paolo Ardoino even claiming Tether aims to become a “gold central bank” and may allocate up to 15% of its reserves to bullion.

How does this affect BTC?
The main impact is competitive capital allocation: Tether’s growing profits from gold mean fewer Tether reserves actively deployed in BTC markets. Several reports and market commentaries highlight the recent narrative: while gold surged, BTC traded sideways or slightly down (BTC -2% during a gold rally), and Tether’s new capital is flowing into gold—there’s no clear “rotation” of those profits back into bitcoin.
**Key points:**
- Tether’s gold buying shows that it currently sees gold as a safer store of value versus BTC, particularly amid geopolitical uncertainty and USD alternatives.
- The explosive growth in Tether’s gold-backed token (XAUT) and the company’s intention to be a major gold player suggest institutional capital may increasingly chase gold over bitcoin, at least for the moment.
- For BTC, this could mean reduced upside in the short term from stablecoin reserve flows, as Tether’s profits and investment focus aren't cycling back to crypto as strongly as some hoped.
📉 **Risks to note:**
If the “gold over BTC” narrative persists, bitcoin may face competitive headwinds—especially while gold continues setting new highs and Tether prioritizes gold reserves over digital asset expansion.
Of course, market sentiment can shift fast. If gold momentum cools or crypto regains institutional attention, Tether’s portfolio could rebalance and bring funds back to BTC. For now, though, the gold rally is the dominant story in Tether’s balance sheet—and it’s making bitcoin the sidekick rather than the star.#CryptoMarketPullback