Tether’s investment branch has purchased a minor interest in Elemental Altus, a publicly traded precious metals company, for approximately C$121.6 million (around $89.2 million). CEO Paolo Ardoino stated this transaction, which allowed Tether to obtain a 33.7% stake, demonstrates their belief in the solid fundamentals of gold.

This investment signifies a move towards diversifying the assets backing Tether’s stablecoin, USDT, which currently holds the title of the largest stablecoin with a valuation of $155 billion. In an announcement made on Tuesday, Tether aims to bolster its exposure to tangible assets and precious metals.

They obtained 78.4 million shares in Elemental from La Mancha Investments, a mining investment firm based in Luxembourg. Following this announcement, Elemental’s shares rose by nearly 23%, increasing the stock price to C$1.77 ($1.30).

“We have confidence in gold’s fundamentals and its crucial role within the financial markets,” Ardoino mentioned. He elaborated that Elemental’s royalty approach offers diversified access to global gold production, aligning effectively with Tether Gold and future commodity-backed digital asset initiatives.

In light of the impending regulatory frameworks for stablecoins in the U.S., Tether, like other issuers, is preparing to comply with new requirements relating to the assets that secure their tokens. It has been suggested that Tether may need to reduce some of its BTC assets to meet these proposed standards.