Stablecoin issuer Tether has officially entered the commodity market, funding a $45 million crude oil transaction. The agreement was announced on November 8 and involves a publicly listed oil company and a commodity trader. The transaction was completed in October, using Tether's USDT, and facilitated the shipment of 670,000 barrels of crude oil from the Middle East.
Led by Tether's Trade Finance division – a branch focused on integrating blockchain technology into traditional trade finance – this agreement marks a significant step in Tether's strategy to expand the application of stablecoins in international trade transactions. Earlier, in early October, Tether revealed plans to provide alternative financial solutions for the $10 trillion commodity trading industry, which primarily relies on traditional banks.
"USDT brings efficiency and speed to capital markets that are inherently reliant on slow and costly payment systems," said Tether CEO Paolo Ardoino. "This transaction is the beginning of our expansion into various goods and industries, promoting innovation and inclusivity in global finance."
In addition to participating in commodity trading, Tether is also exploring the use of its stablecoin as a tool to help international traders avoid using the dollar in countries sanctioned by the U.S., such as Venezuela and Russia, according to a Bloomberg report.
Tether has used a portion of its massive profits to fund this transaction. The company reported a profit of $2.5 billion in the third quarter of 2024, bringing total earnings for the year to $7.7 billion. As of September 30, Tether's total assets reached $134.4 billion, of which $102.5 billion is held in U.S. Treasury bonds. Additionally, Tether owns 7,100 Bitcoin, worth over $530 million at the current time.
Besides developing the stablecoin sector, Tether is also expanding its investment portfolio into areas such as renewable energy, Bitcoin mining, artificial intelligence, telecommunications, and education, reflecting a diversification strategy to ensure sustainable growth and value enhancement in the future.
