Tether to Move Headquarters to El Salvador: Why the Company Needs It
Date: 2025-01-14 Author: Oliver Abernathy Categories: BUSINESS
Tether is one of the largest companies in the cryptocurrency space, managing assets worth over $137 billion. Previously registered in the British Virgin Islands, it has long cooperated with the authorities of El Salvador, contributing to the development of the crypto economy in the country.
According to Tether CEO Paolo Ardoino, this move allows the company to strengthen relationships with partners and focus on growing markets.
Tether's main activity is related to the issuance of the USDT stablecoin, backed by reserves in the form of cash and securities, including US government bonds. The company actively took advantage of the crypto market growth of 2024, making significant profits. Some of Tether's reserves are managed by Cantor Fitzgerald, whose CEO Howard Lutnick will join the new administration of US President Donald Trump.
However, Tether has not yet specified whether it will open a physical office in El Salvador or how this decision will affect its parent company iFinex Inc, affiliated exchange Bitfinex, and operations in the British Virgin Islands.
El Salvador has recognized Bitcoin as an official means of payment along with the US dollar since 2021. The government buys one Bitcoin daily, and as of January 13, the country's official wallet has accumulated 6,472 BTC (approximately $600 million).
In addition, the country has made a deal with the International Monetary Fund, receiving a loan of $1.4 billion. As part of the agreement, El Salvador will eliminate the mandatory acceptance of Bitcoin as payment, and citizens will pay taxes exclusively in US dollars. The country's authorities will also gradually reduce their participation in Chivo, the national Bitcoin wallet.
Tether's move highlights the company's commitment to strengthening its position in the cryptocurrency industry, as well as its willingness to tap into the potential of emerging economies like El Salvador.
