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Investment bank Jefferies said the recent surge in gold prices can’t be explained by traditional drivers alone and points instead to Tether as a major new buyer.

Attestation data and on-chain activity show that the stablecoin issuer has accumulated substantial bullion in recent months, tightening supply and helping fuel the sharp rally, the bank said in the Thursday report.

The precious metal has risen more than 50% this year and is currently trading around $4,080 per ounce.

Jefferies first flagged Tether’s interest after the company met with miners and royalty firms in Denver last fall, with investors telling the bank Tether aimed to buy around 100 tons this year. Public comments from CEO Paolo Ardoino about adding gold to reserves and a $1,000-per-ounce price spike strengthened the case.

Analysts led by Andrew Moss estimated that Tether held at least 116 tons of gold at the end of the third quarter, with 12 tons backing its XAUt token (worth about $1.57 billion) and about 104 tons backing USDT (worth about $13.67 bilion), making it the world’s largest non-sovereign holder and placing it on par with smaller central banks. XAUt currently stands at a market capitalization of about $1.5 billion, according to CoinMarketCap.

The pace of accumulation is what stands out — roughly 26 tons in the third quarter alone, equal to about 2% of global demand, the analysts said. While not enough to overwhelm central-bank flows, the buying likely tightened near-term supply and boosted bullish sentiment.

Tether is expected to continue accumulating as USDT grows and gold remains about 7% of reserves, the report said. With Ardoino projecting $15 billion in 2025 profit, the bank's analysts calculated that even deploying half of that into bullion could add nearly 60 tons annually.

Tether’s planned GENIUS Act-compliant stablecoin, USAT, won’t require gold reserves, leaving its long-term impact on USDT and gold demand uncertain, the report noted.

The analysts also cited Tether’s growing investments across the gold ecosystem, including more than $300 million deployed into royalty and streaming companies this year. The bank views these stakes as further evidence of a broader metals strategy. The recent hiring of two top HSBC metals traders suggests that Tether’s gold push is accelerating rather than easing.