Bitcoin News Today: Tether's High-Risk Gold and Bitcoin Push Pits Stability Against Regulatory Scrutiny

Tether's growing exposure to high-risk assets has drawn renewed scrutiny, with analysts warning that the stablecoin issuer's increasing reliance on Bitcoin and gold could undermine the stability of its flagship token, USDT. The concerns come as Tether CEO Paolo Ardoino aggressively defended the company's strategy, dismissing criticism from S&P Global Ratings, which downgraded USDT's peg stability score to a "weak five" in November 2025. S&P cited Tether's shift toward higher-risk reserves, including a 5.6% allocation to Bitcoin-exceeding its 3.9% overcollateralization margin-as a key risk factor. The agency also highlighted gaps in transparency around reserve management, urging Tether to reduce exposure to volatile assets and provide clearer disclosures.

Tether's reserve strategy has evolved dramatically in 2025, with the company amassing 116 tonnes of physical gold by September, rivaling the holdings of central banks in South Korea and Hungary. This gold acquisition spree, which accounted for 2% of global demand during the third quarter, has been credited with fueling a 50% surge in gold prices year-to-date. Jefferies analysts noted that Tether's purchases have tightened short-term supply and influenced market sentiment, with the firm projecting further accumulation to reach 100 tonnes by year-end. Tether's gold-backed token, XAU₮, has also seen its market capitalization rise to $2.1 billion, supported by a doubling of issuance since August.

The stablecoin giant's diversification extends beyond gold. Tether has simultaneously expanded its Bitcoin holdings, though S&P warned that BTC's volatility poses a risk to USDT's undercollateralization if prices decline. Tether's reserves remain majority-backed by U.S. Treasuries and cash equivalents, but the company's embrace of alternative assets reflects a broader strategic pivot. "Tether is living proof that the traditional financial system is so broken that it's becoming feared by the emperors with no clothes," Ardoino stated in a recent X post, framing the criticism as resistance from a "traditional finance propaganda machine".

Regulatory challenges loom large. The U.S. GENIUS Act, enacted in July 2025, mandates that stablecoins be 100% backed by "high-quality liquid assets," excluding gold from compliance. In response, Tether announced plans for a U.S.-specific stablecoin, USAT, fully backed by Treasuries, while maintaining its gold and Bitcoin reserves globally in response to the U.S. GENIUS Act. This bifurcated approach aims to navigate regulatory complexity while preserving flexibility. Meanwhile, Tether's recent shutdown of mining operations in Uruguay-citing high energy costs-highlights the challenges of scaling energy-intensive activities in high-cost markets according to CoinDesk.

Market participants are divided. While Tether's strategy has bolstered its profitability and positioned it as a quasi-central bank with diversified reserves, critics argue the lack of independent audits and transparency risks eroding trust. The company's omnichain stablecoin, USDT0, which has processed $50 billion in cumulative transfers across 15 blockchains, underscores its push to expand liquidity. However, regulatory scrutiny and macroeconomic shifts-such as potential Federal Reserve rate cuts-could test the resilience of Tether's model in 2026.