Original: The Block

Compiled/Organized by: Yuliya, PANews

In an era where stablecoins are gradually permeating the global economy and AI intersects with blockchain technology, a highly controversial and influential company is quietly building its "infinite funding gap" strategy. This episode of The Block features Tether CEO Paolo Ardoino, who shares Tether's on-chain layout ideas, multi-billion dollar investment directions, systematic strategies for AI and energy, and even long-term ambitions to establish an open brain-computer interface system. PANews has compiled and organized the dialogue.

Tech Geek Turns Stablecoin Leader, Calls for Stronger US Regulation on USDT

Host: Welcome, Paolo. Can you introduce yourself and how you became the CEO of Tether?

Paolo: I am a tech enthusiast, having been coding for 32 years since I was a child. I initially worked as a senior developer at Bitfinex, later becoming the CTO of both Bitfinex and Tether, and in 2023, I became the CEO of Tether. My philosophy has always been to create technology that can endure even in the worst scenarios, rather than systems that only work in ideal environments.

Host: A few years ago, Tether faced many doubts, but now it has become one of the most profitable companies globally, with a profit of $13 billion last year alone. How do you view the transformation over the past few years?

Paolo: Our entire industry is still in its early stages. Tether was founded in 2014 and introduced the concept of "stablecoins," which hardly anyone cared about in the first ten years. But now, 2025 is being called the "year of stablecoins," and the US government is formulating corresponding regulations, which says it all.

This process has not been easy. We started from scratch to build a brand new industry, naturally encountering friction with the traditional financial system and facing many obstacles, especially from the banking system. But our team has never backed down, always believing in providing dollars to those excluded from mainstream finance.

For me personally, this is also the first time I have truly stepped into the US—I was 40 years old when I first came. In recent years, regulatory actions like "Chokepoint 2.0" have been very unfavorable to us, but I can feel a change in attitude during recent communications on Capitol Hill and with executive agencies.

The global influence of stablecoins is indeed increasing, especially in developing countries, where their role is particularly prominent. For example, the US financial system is already very well-developed, with an efficiency of 90%, and stablecoins can enhance it to 95%. But in countries like Nigeria, Argentina, or Turkey, financial efficiency may only be 10% to 20%, and with stablecoins, it could leap to 50%. So for these countries, the significance of stablecoins is even greater.

Regulatory frameworks should also take this into account and provide appropriate protections for overseas issuers like USDT. While USDT is a foreign stablecoin for the US, its importance is undiminished and is even more crucial for maintaining the global status of the dollar and purchasing US Treasury bonds.

Host: Do you think the US will launch its own stablecoin in the future?

Paolo: Even if the US launches its own digital currency, privately issued stablecoins will still play a crucial role. The success of USDT precisely demonstrates that privately issued stablecoins can provide significant assistance to the US. We hold a large amount of US Treasury bonds through domestic institutions like Cantor Fitzgerald, and the process is extremely transparent. The US can closely supervise us without bearing the burden of issuance and management.

Using USDT and XAUt to Change Lives in High-Inflation Countries, Education is a Long-Term Battle

Host: You once shared an example of a convenience store pricing items in USDT. Can you talk about how USDT is changing lives in high-inflation countries? Do you think this will become a common phenomenon?

Paolo: Unfortunately, the success of USDT is not because we are doing well, but because many countries' economies are in terrible shape. Take Turkey, for example, where inflation is as high as 50%, and the local currency has depreciated by 80% against the dollar in recent years; Argentina is even worse, with its currency depreciating by over 90% and multiple defaults. USDT provides a safe haven for these countries.

We found that the proliferation of smartphones and the high proportion of young people are key factors driving the adoption of digital dollars. From 2017 to 2020, young people became the first group to learn about cryptocurrencies. After the global pandemic in 2020, these young people began teaching their parents how to use digital dollars to cope with economic difficulties. For the past 20 years, these parents have been accustomed to taking risks by buying cash dollars on the black market, but the pandemic made this behavior more dangerous and inefficient. Young people learned from each other on platforms like Discord and then passed that knowledge on to their parents, helping them safely hold digital dollars through smartphones.

Host: How do you understand Tether's role in the current geopolitical landscape, especially in terms of expanding "Western values"?

Paolo: In my view, money is the ultimate social network, and the changes driven by Tether have a threefold impact.

First, what we are doing in financial inclusion is more effective than many international organizations, NGOs, and even charitable institutions. This shocks me—if a small company can achieve what they have failed to do for decades, then they really need to reflect. We are genuinely bringing financial services to hundreds of millions of people who are still excluded.

Second, Tether is expanding the global use of the dollar, promoting dollar hegemony. This is not an exaggeration; we have established millions of offline touchpoints in emerging markets, from convenience store networks in Central America, phone top-up points, newsstands, to rural markets in Africa, where we have direct contact with them. These distribution channels can also be used for financial education and even selling other products.

Third, we are building our own energy and financial infrastructure in Africa. In this continent with extremely low electricity coverage—600 million out of 1.4 billion people have no electricity at home—we are creating solar-powered financial service kiosks. In these small villages, Tether's kiosks provide rechargeable batteries for just 3 USDT per month. Residents learn how to open USDT and Bitcoin wallets, save, and transfer money through these kiosks. We have deployed 500 such kiosks in Africa, with 500,000 users and 10 million battery replacement records. We expect to expand to 10,000 kiosks by 2026 and 100,000 by 2030, covering about 30 million African households. This is not just financial distribution; it is also the distribution of light. We aim to illuminate the heart of the African continent, creating a network that can be seen from space.

Host: Besides USDT, you also have Tether Gold. In countries with high inflation, is it possible to see a "return to the gold standard"? Why did you launch Tether Gold?

Paolo: We approach any product from a practical perspective. If fiat currency is the lowest quality tool, then the dollar is the best among fiat currencies, with gold above it, and at the top is Bitcoin.

Bitcoin, as a currency controlled by mathematical rules, is unique in that it is entirely determined by algorithms and code, unaffected by any country or individual. In contrast, gold has been recognized as currency for 5,000 years; it is not easily manipulated and is primarily governed by natural laws, meaning it will not depreciate like fiat currency due to inflation. Although future technological advancements may increase gold mining, the growth of its supply will still be limited by natural laws, and gold's supply will only increase slowly in the future, not double in a few years or even a decade.

So we launched Tether Gold because, outside of Bitcoin, it is the best asset tokenization product we can offer. Especially now, with gold prices doubling in three years, as BRICS countries are preparing a gold-backed digital currency and building infrastructure in Africa, South America, and other regions. This type of currency is neither the renminbi nor the ruble; it is simply "gold-backed," which is very attractive to these emerging markets. We hope to provide an alternative before they do.

Host: What do people really care about? Do they just want a tool for transferring money and don't care about the underlying technology (like blockchain)?

Paolo: They are not interested in blockchain itself. What they care about is one thing—low fees, almost zero.

We recommend some partners' digital wallets and encourage them to store USDT in these wallets. But we also found a problem: many wallets are pushing flashy features to users, such as using USDT to invest in a certain coin, participate in staking, or buy NFTs. These behaviors are detrimental to household savings.

So we decided that Tether should create a wallet aimed at these markets, truly centered on the savings experience. We are developing an open-source SDK called the Wallet Development Kit (WDK), which anyone can use to develop wallets. This wallet interface will be very simple, with only two accounts: one for daily USDT transactions and another for savings, which can be used to store Bitcoin and connect to decentralized yield protocols. Developers can choose to add new features, but our default version is a minimalist version designed for African users. We are also collaborating with Opera's MiniPay team and looking for more partners.

We have done the most Bitcoin education globally, but in these markets, we often receive feedback like, "I understand Bitcoin, but I still want USDT."

This is not because people are ignorant, but because they lack the time or resources to deeply understand Bitcoin. Many "Bitcoin extremists" overlook this point, thinking that everyone in the world has the conditions to study cryptocurrencies, which is not the case.

Therefore, we want to use something they are familiar with—like USDT—to first build trust and then gradually guide them to engage with Bitcoin. Education is a long-term battle; it cannot be achieved through mere words; it requires real action. Tether is investing significant funds and resources to advance this process.

Maintaining Ecological Neutrality, Providing Users with the Optimal On-Chain Path

Host: Most of Tether's on-chain circulation occurs on Ethereum and Tron. Now we see an increasing number of "stablecoin-exclusive chains" emerging. How do you view these new trends?

Paolo: Tether has never and will never create its own blockchain. I believe it is important not to encroach on the business of our partners. There should be an open market with fair competition among different blockchains. The problem is that blockchains like Ethereum have very high transaction fees. I would like to see more activity on chains that offer a better user experience and lower fees.

Therefore, Tether plans to experiment with its new wallet and products to develop an algorithm that allows users to automatically bridge a portion of their funds via USDT to the blockchain with the "lowest transaction fees" and "fastest confirmation speed." This initiative aims to provide users with a fairer ecosystem, especially helping those who cannot afford high transaction fees. Additionally, the system will support multi-chain QR code recognition to foster a sense of responsibility among blockchain developers for the ecosystem.

Host: So your vision is that Tether itself will remain completely neutral across all chains, and users won't even need to know which chain their money is being sent on; it will work seamlessly across multiple blockchains. You will choose the best path for them based on factors like transaction fees, correct?

Paolo: Yes. And I think it's not even us choosing for them. We want a very open, transparent, and public algorithm that every blockchain can see. I don't want to be the referee, nor do I want to be accused of bias. As long as the algorithm is public and everyone can see it, then everyone should be satisfied. It will route transactions to the cheapest and fastest chain, and that's it.

Opening a $10 Billion Investment Game, Gaining Long-Term Strategic Initiative Through Independence

Host: How do you think about your investment strategy? What do decision-makers prioritize?

Paolo: Tether has earned about $20 billion in the past two to three years. Less than 5% of that has been allocated to shareholders. Our idea is to keep most of the funds within Tether's investment department. As you mentioned, part of the excess reserves is used for over-collateralization of stablecoins, but the remaining approximately $14 billion or more is currently being invested in various ways.

One part is used to expand our distribution network, such as in Africa and Central and South America, where we have invested heavily in terminal nodes and payment infrastructure. We currently hold a portfolio of over 50 to 60 companies across various sectors, including education, mobile, and app distribution. We are not just distributing digital dollars; we can also distribute Tether Gold, educational content, apps, etc. This way, we have established a comprehensive distribution network that further expands the monetary base of USDT.

The second part is investing in digital distribution networks, such as Rumble, which is a video platform with 70 million users. An interesting fact is that Rumble's creators sold $850 million worth of gold between 2023 and 2024. Imagine the opportunities if Rumble launched a wallet supporting Bitcoin and Tether Gold! So we hope to combine this digital infrastructure with asset distribution.

Additionally, we have more long-term but very stable investments. For example, we invested in Adecoagro, the largest single landowner in South America, which has extensive farmland in Brazil, Argentina, and Uruguay, and is also involved in the production of dairy products, rice, bioethanol, and other agricultural products. We believe that land is close to Bitcoin and gold in terms of scarcity; although it has a high degree of non-fungibility, it is still a very robust long-term asset. More importantly, Adecoagro is also exploring the use of stablecoins like USDT for commodity trading. We believe that commodity trading will become the biggest driver of USDT's market cap growth. We are negotiating with major global commodity traders, all of whom are very interested in settling commodities like crude oil and gold using USDT because it is more efficient and cost-effective.

We are also investing in Bitcoin mining and energy sectors. Tether Group currently holds over 100,000 Bitcoins, and we believe that since we have such a large exposure, we must contribute to the security of the Bitcoin network. Therefore, we have made significant investments in Bitcoin mining. Although from a purely economic perspective, if you have $1 million, buying Bitcoin might be more cost-effective than mining, we invest in mining to be part of the network's security. By the end of this year, Tether may become the largest Bitcoin miner in the world.

Finally, in the AI sector, we invested in Northern Data, a leading AI infrastructure company with over 24,000 H100 GPUs and its own AI R&D team. We are also developing a P2P inference and federated learning platform called "CUAC," inspired by Isaac Asimov's short story "The Last Question," which poses the ultimate question: "Can entropy be reversed?" The philosophy behind this is that if one day we want AI to answer this question, it must be part of the structure of the universe, not a data center system controlled by a centralized company.

Host: This structure, which does not rely on external funding, almost frees Tether from all IPO and shareholder profit pressures. You mentioned this is an "infinite money loophole." Can you elaborate on this logic?

Paolo: Tether's business model and stablecoin structure allow us to remain private for a long time. We do not need to go public, do not need to raise funds, and do not need to be accountable for quarterly financial reports. This independence allows us to make long-term investments and considerations.

For example, we invested in a company called Blackrock Neurotech (soon to be renamed), which focuses on brain-computer interfaces. We believe that within the next 15 to 30 years, the brain will become the new smart terminal, equivalent to today's smartphones.

We do not want this technology to be monopolized by centralized platforms, so we are building an open-source brain operating system. If one day I really need to implant a chip in my brain, I hope it is open-source and not controlled by some tech giant—I am indeed a bit paranoid, but that is the foundation of fair competition.

Currently, this company has over 40 patients trialing the first-generation brain-computer interface chip, and the capabilities of the new generation chip are "mind-blowing," which excites us greatly.

Host: Tether has also invested in Juventus Football Club. Is this out of interest or is there a strategic consideration?

Paolo: Giancarlo (another Tether executive) and I have been die-hard Juventus fans since childhood, so this is indeed an "emotional investment."

But at the same time, we believe that the Italian football system is very backward, almost like a bureaucratic machine. Football clubs should not just be about sentiment; they should operate like businesses, with profits, management, and the ability to buy better players, improve communication systems, and expand their fan base.

Tether can help Juventus achieve these goals. We have a global digital and physical distribution network that can promote Juventus's brand worldwide. Additionally, many of the technology companies we invest in can also support Juventus.

So, while this investment started from passion, we are gradually injecting rationality and strategy into it.

Not Just Stablecoins, Tether's "Four Stability" Philosophy

Paolo: When someone asks me, "What kind of company is Tether?" I say, "Tether is a stable company," and it aims to provide three types of "stability" to society:

• Monetary Stability: For emerging markets, stablecoins represent a significant leap; for developed markets, Bitcoin may be more important.

• Communication Stability: This refers to freedom of speech. For a society to be stable, citizens must be able to communicate freely. If control over the flow of information is lost, the social structure will become unstable.

• Intelligent Stability: With the development of AI, if it is controlled centrally, it could create an intelligence gap that is more severe than the current gaps in currency or communication. For example, if the Italian government heavily relies on OpenAI's products, and one day diplomatic relations between the US and Italy break down, the entire Italian society could "become less intelligent."

We are also establishing decentralized energy systems in Africa. Some people suggest we "build nuclear power plants," but we believe the most practical approach is to deploy distributed renewable energy nodes.

With this addition, our current vision has evolved from "three stability" to "four stability": stable currency, stable communication, stable intelligence, and stable energy. Only by combining these four can society truly achieve stability.

Host: It sounds like you are doing a lot of philanthropic work. Is this a form of imitating "effective altruism"? Or are the shareholders already wealthy enough to engage in these socially progressive initiatives?

Paolo: I don't want to be categorized as an "effective altruist"; everyone knows where that movement has led. But we do believe that when a company has accumulated enough resources, there is no need to profit from every single thing.

In the future, every AI agent will have a wallet, and it should be a self-custody wallet. In 15 years, we will have a trillion AI agents. They cannot all connect to PayPal or JPMorgan's servers. I believe AI agents will use stablecoins and Bitcoin for transactions. If we implant a self-custody wallet into each AI agent, these AI agents are likely to choose USDT as one of their primary currencies.

This is the point I made in my speech at Token 2049. Tether is fortunate because we have three things:

• Technical Capability: We have not only built the most widely used stablecoin system globally but also developed decentralized communication platforms like Holepunch. Our tech stack is highly free and scalable.

• Philosophical Ideology: We come from the Bitcoin world, and we believe that freedom is the ultimate goal. Tether's ultimate goal is to defend freedom.

• Capital: In this regard, we have great autonomy and do not rely on venture capital. VCs generally only want to invest in products that can be directly controlled and monetized, while peer-to-peer products like Keet and Holepunch cannot be controlled by nature. Therefore, we can use our own capital to build these truly open systems.

Tether is committed to maintaining independence and avoiding becoming a negative force. Even if changes occur in the future, we hope that the technologies we create can exist independently, which is the core appeal of peer-to-peer technology.

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