Tether Broadens Tether Gold Use as Ledn Adds XAUT for Collateralized Loans

Tether is expanding the use of its gold-backed token, Tether Gold, as it pushes into the digital gold-collateralized lending market.

CoinDesk reported on June 28 that crypto lending platform Ledn will add Tether Gold, or XAUT, as a supported asset. Ledn currently supports Bitcoin and Tether’s USDT, and plans to launch loans backed by Tether Gold later this year.

Tether Gold is backed one-to-one by one troy ounce of physical gold held in Swiss vaults. Tether currently holds about $23 billion of gold and issues Tether Gold based on those holdings.

The companies said tokenized physical gold can serve as digital collateral much like Bitcoin, allowing holders to access liquidity without selling their assets.

Ledn said it will custody Tether Gold on a one-to-one basis, the same way it handles Bitcoin-backed loans. It added that it will not lend out client assets or use them to generate yield.

Chief Executive Officer Paolo Ardoino said demand is increasing for solutions that offer both long-term holding and financial flexibility as digital assets take on a bigger role in the global economy.

Tether has been accelerating efforts to diversify its business using profits from its USDT operations. The company holds about 140 tons of physical gold and is working to expand the use of XAUT in lending and physical redemption through an investment in gold trading platform Gold.com and a partnership with crypto financial firm Antalpha.

Tether is also broadening its investments into Bitcoin mining, renewable energy and artificial intelligence infrastructure.