In a significant development, Cantor Fitzgerald, led by CEO Howard Lutnick, has acquired a 5% stake in Tether, the world’s largest stablecoin issuer. The stake, valued at $600 million, places Tether’s market worth at about $12 billion. This development has caused a notable buzz in the crypto community.
In addition to his crypto ascent, Lutnick has returned to the political spotlight. Once a co-chair of President Donald Trump’s transition team, he was recently nominated for the U.S. Commerce Secretary in Trump’s upcoming administration. This news adds a political dimension to his stake in Tether, raising speculation about a pro-crypto shift in U.S. policy.
Cantor’s Partnership with Tether and Political Power Play
Over the past year, Cantor Fitzgerald has deepened its financial and operational ties with Tether.
According to reports, Cantor holds many of Tether’s $133 billion assets, earning tens of millions in fees annually. This relationship solidifies Tether’s liquidity management and reflects Cantor’s growing role in the crypto economy.
Howard Lutnick’s nomination as Commerce Secretary has drawn attention to his crypto connections.
A Tether spokesperson called claims of regulatory maneuvering laughable and insisted their partnership is strictly professional. Nevertheless, Tether’s leaders reportedly see Lutnick as a crucial ally in dealing with upcoming U.S. laws aimed at offshore stablecoins.
Lutnick Faces Political and Economic Crossroads
In a recent interview, Lutnick revealed his plans to resign from Cantor, BGC, and Newmark roles. This move is to comply with ethics rules upon Senate confirmation.
He insisted that he would fully separate from Cantor’s operations. However, the timing of this high-profile investment in Tether raises questions about its implications for U.S. crypto policy.
As Lutnick navigates his political future, the implications for the crypto industry and its regulatory framework remain unpredictable. Only time will reveal how this power, finance, and politics convergence will shape the U.S. economic narrative.
Tether Under Regulatory Pressure Amid Financial Success
Tether continues to excel in the stablecoin market, reporting $7.7 billion in profits in the first nine months of 2023. This growth is fueled by rising Treasury yields and increased use of stablecoins. Also, Tether’s USDT is leading in the stablecoin market as a key link between fiat and digital currencies.
Amidst its financial success, Tether remains under regulatory scrutiny. Authorities are probing its potential misuse for illegal activities like terrorism and hacking.
The U.S. Treasury Department is considering sanctions due to its use by sanctioned entities. Tether’s CTO, Paolo Ardoino, has firmly denied these allegations, accusing the media of repeating unsubstantiated claims.
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