In this week’s Crypto Conversations we sat down with Paolo Ardoino, the CTO of Bitfinex and Tether, to discuss the recent launch of Tether Gold.
Tether Gold, or XAUT, is a gold-backed digital asset offered by Tether in collaboration with TG Commodities Limited. Tether Gold brings traders the combined benefits of physical and digital assets, with the asset allowing digital asset traders to take positions in the traditional Gold markets. XAUT traders can enjoy the upside of gold whilst avoiding the drawbacks associated with physical gold, including storage costs and accessibility.
Read the full conversation below, and visit Delta Exchange to trade XAUT with up to 20x leverage.
Q1: How did the idea for Tether Gold ($XAUT) originate?
“We listened to our customers. They wanted a low cost way to own gold without the usual limitations of owning physical gold. Tether delivered.”
Q2: What has been the impact of COVID19 on Tether Gold operations?
“When there was a full lockdown in Switzerland, this did make it harder for Tether Gold to acquire new gold bars because of the Swiss lockdown. But in recent weeks we haven’t had any issues and things are back to normal.”
Q3: What do you see as the benefits of uniting the digital asset space with the traditional Gold space?
“Gold-backed stablecoins like Tether Gold help transform gold from an awkward asset to hold, into an asset with portability, divisibility and transferability. At least with Tether Gold, it also represents a lower cost way of owning gold than is available in traditional markets.
“Gold is a well understood asset. We think that combining the benefits of digital assets with an asset like gold helps draw new people into the growing digital assets industry and helps educate them on the advantages of digital assets. Brining in new people with new perspectives helps mature the digital assets industry.”
Q5: What is on the roadmap for Tether Gold?
“The roadmap is to make sure that the growth of Tether Gold continues its strong growth. It would be nice to see it more broadly adopted so that its liquidity in secondary markets starts to approach Tether (USDt).”
Q6: Do you envision copies of Tether Gold to the same extent of USDt? Can we expect another “asset-backed stablecoin” boom?
“Gold is technically an asset that is understood by many people. Many investors are interested in using gold to hedge against global monetary policies and things like that. It is hard to forecast how much Tether Gold will grow by. Although gold is a very common asset for hedge funds and investors at the same time it has much more volatility than USDt. It is hard to believe that gold will become bigger than cash. Setting-up a product like Tether Gold is also trickier than a fiat backed stable-coin, so it seems unlikely we’ll see a similar boom.”
Q7: Can you tell us a bit about what makes Tether Gold different from other gold-backed assets? What makes XAUT unique?
“The fact that Tether Gold has direct access to the vault, this is a really important fact and an important differentiator from many competitors.”
Q8: What does the launch of XAUT suggest about the development of the digital asset industry as a whole? Did you envision the launch of XAUT when you started at Bitfinex in 2016?
“This shows that the digital asset market is becoming more and more mature. This is a clear sign that the crypto community is maturing and is a good sign for the overall ecosystem.”