By Federico Maccioni
DUBAI (Reuters) – The cryptocurrency firm is considering moving its headquarters to El Salvador, its chief executive said, as the founders of the world’s largest stablecoin seek to capitalize on the Central American country’s bid to become a hub of crypto trading.
Tether has become a dominant force in the booming market for stablecoins, designed to maintain a constant value by being pegged to traditional currencies and offering users a way to move money between cryptocurrencies without exposure to price fluctuations.
CEO Paolo Ardoino told Reuters that Tether would move to El Salvador after the cryptocurrency was recently licensed there as a digital asset service provider. Ardoino and his fellow Tether directors and co-founders will also move their residences to El Salvador, he said. Previously, the company was incorporated in the British Virgin Islands.
“This move to El Salvador will be the first time we also have a physical headquarters,” he said. But not all of the company’s more than 100 employees will move there, he said, adding that much of the staff works remotely.
The company plans to hire 100 Salvadorans over the next few years, he said.
The booming stablecoin market has worried regulators, fearing that the growing reserves of stablecoins will expose the broader financial system to greater risks, as they act as a bridge between the crypto universe and the markets traditional financial institutions.
Tether has faced questions regarding its reserves and does not fully disclose where they are held or in what form. The company says the vast majority of its stablecoins are backed by traditional currency reserves held at Wall Street brokerage firm Cantor Fitzgerald, whose CEO Howard Lutnick has been named head of the U.S. Department of Commerce under the leadership of President-elect Donald Trump.
“So we have liquidity at other banks, but the vast, vast majority of Treasuries are at Cantor,” Ardoino said.
STRENGTHEN TOKEN TRACKING
The company said last year that it was increasingly monitoring how its tokens are used to combat illicit financing.
When asked if Tether had considered other locations for its headquarters, Ardoino said it does not have a license to operate in the European Union and has ruled out the United States for now . It’s “pretty premature” to predict possible changes that might be implemented under Trump, he said.
Trump’s victory in the US elections in November triggered a record rise in cryptocurrency prices. The Republican pledged to introduce a friendlier regulatory environment for crypto and said he plans to create a US strategic reserve for bitcoin.
El Salvador is seeking to become a hub for digital currency trading, and three years ago President Nayib Bukele made it the first country to establish bitcoin as legal tender, alongside the dollar.
“Welcome home,” Bukele wrote on social media platform X in response to Tether’s announcement. In another post published Monday, Bukele asked Rumble CEO Chris Pavlovski to consider moving the video-sharing platform’s headquarters to El Salvador. Days earlier, the company announced a cloud services agreement with Bukele’s government.
Tether’s eponymous dollar-pegged token (USDT) represents about two-thirds of the $212 billion worth of stablecoins in circulation, according to CoinGecko data.
The overall market has grown about 45% over the past year, according to the data.
