Tether and Antalpha are raising $200 million to create a gold-backed digital asset company

Tether and Antalpha Platform, which is tied closely to Bitmain, are trying to pull in $200 million from investors to launch a public vehicle that would hold tokenized gold.

Per a report from Bloomberg, the plan is to create a digital-asset treasury company that will stockpile XAUt, the gold-backed token issued by Tether, while Bitmain supplies about 82% of the planet’s crypto mining machines, according to an April study by the University of Cambridge Judge Business School.

Sources also said that Cohen & Co. is the lead advisor on this deal. They declined to be named because the talks are private. This effort adds another layer to the long-running collaboration between Tether and Antalpha.

The two companies already work together on Tether Gold, which according to Tether’s site has a market capitalization of $1.5 billion. That token launched in 2020 through a Tether subsidiary and is fully backed by physical gold bars stored in vaults.

Tether and Antalpha expand gold token plans

On September 29, Antalpha announced that it was expanding its partnership with Tether to make XAUt easier to access. It said it will offer collateralized lending against the token and set up physical vaults in major financial centers so holders can swap their digital tokens for real gold bars.

Antalpha confirmed that Tether purchased an 8.1% stake in its company back in June, cementing their financial link.

Meanwhile, demand for gold has spiked 46% this year amid fears over inflation and global political tensions. CoinGecko data shows that the market capitalization of Tether’s gold token doubled during the same period.

While working on this $200 million fundraise, Tether is also trying to raise as much as $20 billion for its main stablecoin business. If that succeeds, the company would be valued at about $500 billion, which would make it one of the biggest privately held firms in the world, as Cryptopolitan reported.

Data from PitchBook shows that more than 80 companies have set up digital-asset treasury companies this year. Many are following a model inspired by Michael Saylor’s Strategy, which bought large amounts of Bitcoin.

These companies often use reverse takeovers or special purpose acquisition vehicles to build listed proxies for assets like Bitcoin or Ether.

Back in April, Tether shared that it had teamed up with an affiliate of Cantor Fitzgerald LP and SoftBank Group to create a Bitcoin treasury company called Twenty One Capital.

But even as these crypto treasuries multiply, a growing number of them have seen their stock prices drop recently as interest from institutional investors cools off.

Get $50 free to trade crypto when you sign up to Bybit now