Trapped in the BTC invisible trader conspiracy theory? Uncovering Tether’s Bitcoin strategy

Author: Nancy, PANews

At the center of the stage of the 2025 Bitcoin Conference, Tether CEO Paolo Ardoino stood in front of an image of Wukong and said, "Bitcoin is my Wukong and our friend."

This seemingly emotional expression is actually a microcosm of Tether's strategic core. As the issuer of the world's largest stablecoin USDT, Tether is embedding itself into multiple levels of the Bitcoin ecosystem as a builder. From reserve asset allocation to mining business, from ecological investment to infrastructure construction, Tether is penetrating into the nerve center of the new global financial order.

Because of Tether's deep penetration in the Bitcoin system, its actions have also triggered more and more conspiracy theories and caused heated discussions overseas, questioning that it has artificially pushed up the price of Bitcoin by continuously issuing USDT, and built a "closed-loop bubble" that is mutually circulated by Bitcoin reserves, gold support and USDT issuance.

Establishing a Bitcoin reserve strategy and being accused of being the only major buyer

Since May 2023, Tether has announced that it will regularly allocate up to 15% of its realized net operating profit to purchase Bitcoin. Tether expects that the current and future Bitcoin holdings in its reserves will not exceed the shareholder capital buffer, and will further strengthen and diversify its reserves. As of the first quarter of 2025, Tether held Bitcoin worth approximately US$7.66 billion, a significant increase from the previous quarter.

The "gold + Bitcoin" dual-round reserve mechanism is Tether's hedging combination against sovereign legal currency risks and has brought substantial financial returns. Ardoino recently disclosed that Tether currently holds more than 100,000 bitcoins and more than 50 tons of gold. In 2024 alone, Tether's net profit reached $13.7 billion, of which gold and bitcoin investments contributed about $5 billion in profits. Ardoino once said that they hold gold not to challenge Bitcoin, but to challenge the centralized legal currency system.

However, Jacob King, founder of WhaleWire, pointed out that "depending on continuous printing of money and taking over, Tether is the only big buyer in the entire Bitcoin market. It sells the excess after raising the price of Bitcoin by printing new USDT, and buys US dollars and gold as reserves to prove its legitimacy." He called this model the "ultimate house of cards." Once stablecoins face regulation or Bitcoin demand dries up, the entire system may be unbalanced.

Tether's ambition for Bitcoin is far more than just hoarding its own coins. In April this year, Tether, together with SoftBank and Cantor, jointly launched the crypto investment joint venture Twenty One Capital, with the goal of building a global Bitcoin asset acquisition and management platform with a total scale of US$3 billion. This platform is regarded by the industry as Tether's structural layout against MicroStrategy. In this joint venture transaction, Tether holds 42.8% of the equity and 51.7% of the voting rights of the joint venture, and actually has the dominant power. Cantor holds 5% of Tether's shares, and its CEO Brandon Lutnick is the son of US Secretary of Commerce Howard Lutnick.

"Jack Mallers (CEO of Twenty One Capital) has close ties with the Tether and Bitfinex systems, and his other company Strike has long had close ties with Tether. They claim that there is a huge market demand, but most of their reserved bitcoins come directly from Tether. This is a 'shell operation' in a larger liquidity trick." Jacob King bluntly stated on social media that if stablecoins are subject to US regulation in the future, Tether will find it difficult to continue injecting water, and that in recent months, Bitcoin spot ETFs have continued to experience huge net outflows of funds, indicating that institutions are retreating rapidly.

On-chain data shows that Twenty One Capital's Bitcoin reserves come from Tether, which recently injected more than 37,000 BTC through five transfers, worth nearly $4 billion.

Rumble, a video platform invested by Tether with more than $770 million, has also established its own Bitcoin vault, saying that Bitcoin has the potential to be used as an inflation hedge tool.

Self-built mines and strategic investments go hand in hand, planning to become one of the world's largest miners

Tether's ambitions go far beyond asset reserves. As early as 2023, Tether launched a renewable energy-driven Bitcoin mining project in Uruguay, using the abundant local clean energy resources (such as hydropower and wind power) to create an efficient and sustainable mining base. Soon after, it participated in El Salvador's volcanic energy plan and became the capital force driving one of the world's largest geothermal Bitcoin mines. After that, Tether continued to expand its energy map in Latin America, and has invested a total of US$500 million in Uruguay, Paraguay, and El Salvador to build a vertically integrated mining base. "El Salvador's so-called Bitcoin investment is actually a carefully created illusion. The Bitcoin in its treasury was transferred directly from Bitfinex and Tether. Tether even drafted all of El Salvador's Bitcoin bills. But many people didn't notice that El Salvador had quietly given up on promoting Bitcoin as a legal tender. Tether and its internal network can't support all of this because there is no real market demand." There is no clear evidence to support some of Jacob King's claims, but in February of this year, El Salvador did pass a Bitcoin bill to formally cancel Bitcoin's status as a legal tender. Merchants and institutions are no longer forced to accept Bitcoin, and it cannot be used to pay taxes. Polls show that the vast majority of people have not benefited, and the economic situation has not improved.

In addition to building its own mining farms, Tether is also actively expanding its global mining footprint through investment and mergers and acquisitions. So far, it has invested in companies such as Bitdeer, Northern Data Group, Blockstream and Swan Mining, covering chip procurement, server manufacturing, data center construction and even enterprise-level computing power hosting, becoming an important handle to support Tether's Bitcoin mining layout.

This year, Tether went a step further and announced that it would deploy computing power to the OCEAN mining pool to promote the construction of decentralized Bitcoin mining infrastructure. At the same time, Tether recently announced plans to open source its Bitcoin mining software, which will allow new miners to enter the market without relying on expensive third-party suppliers.

According to Ardoino's disclosure at the Bitcoin 2025 Conference, Tether has invested more than $2 billion in energy and infrastructure, and has actually invested more in Bitcoin mining. It is expected that by the end of this year, Tether will become the world's largest Bitcoin miner, a forecast that covers all listed companies.

Full-stack layout from Bitcoin chain issuance to cultural penetration

Tether is advancing its full-stack strategic layout and continuing to expand the boundaries and influence of the Bitcoin ecosystem.

For example, on the technical level, in addition to chains such as Ethereum and TRON, Tether issues USDT to Bitcoin protocols through Omni, Liquid, Lightning, RGB, etc., and supports the popular Bitcoin sidechain network Plasma, which is expected to natively support USDT; in terms of wallet tools, Tether AI has launched a self-custodial wallet WDK, which natively supports Bitcoin and USDT, allowing enterprises, applications, websites and even AI Agents to access, thereby further lowering the threshold of Bitcoin financial infrastructure; in terms of payment ecology, Tether donated the open source project BTC Pay Server to support the continuous development and optimization of its open source encrypted payment processor.

In terms of culture and education, Tether co-hosted the Plan B Summit with the city of Lugano, Switzerland, sponsored local football clubs, and introduced the brand image of Bitcoin into the European stadium culture; at the same time, with the help of Tether's education program, it established partnerships with many universities around the world to promote the popularization of Bitcoin knowledge and cultivate the next generation of crypto natives. In the future, Twenty One Capital will also focus on the popularization of Bitcoin-related knowledge, create educational content and video media, and develop a series of financial and consulting services related to Bitcoin.

"For me, the most important thing is that I can contribute to building a more accessible, more resilient, and more useful Bitcoin ecosystem. If I can play a role in infrastructure, technology, and education, that's enough. The story of Bitcoin has never been about a certain person, but the global community's persistence in an idea - even at a low point, even if it is not understood, we must firmly build the future. If I can play a role in helping more people join the ecosystem and give them sovereignty and security tools, it will be a mission worth remembering for me." Ardoino said in an interview with Bitcoin News not long ago.