Tether Group to Establish Headquarters in El Salvador in Emerging Markets Push

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What to know:

  • Tether, issuer of the $137 billion USDT stablecoin, said it is relocating its headquarters to bitcoin-friendly El Salvador following regulatory approval.
  • The “decision is a natural progression for Tether as it allows us to build a new home, foster collaboration, and strengthen our focus on emerging markets,” CEO Paolo Ardoino said.
  • El Salvador’s crypto-friendly policies, including adopting bitcoin (BTC) as legal tender in 2021, have made it a growing hub for digital asset firms.

Tether, a significant player in the cryptocurrency world that oversees the $137 billion stablecoin USDT, announced plans to set up its headquarters in El Salvador, a country known for its welcoming attitude towards Bitcoin, according to statements made on Monday.

The company announced that the new development was made possible following the acquisition of the required licenses for being a stablecoin issuer within the nation.

As a crypto investor, I’m excited to share that Tether, the company behind the popular stablecoin USDT, will be relocating some of its incorporated subsidiaries to El Salvador. This significant step marks the opening of their first physical headquarters in the country. Until now, most of their entities have been based and licensed in the British Virgin Islands (BVI). However, this shift doesn’t alter Tether’s existing presence in Lugano, Switzerland, a renowned crypto hub.

Last August, two companies associated with Tether, namely Tether NA El Salvador, S.A. de C.V. and Tether International El Salvador, S.A. de C.V., were granted regulatory approval for the majority of cryptocurrency-related activities in El Salvador, as per the public records of the National Commission of Digital Assets (CNAD), which serves as the government’s crypto regulatory entity.

In his statement, Tether’s CEO, Paolo Ardoino, explained that this move is a logical step forward for Tether, enabling them to construct a fresh platform, promote partnerships, and fortify their emphasis on rapidly developing markets. He added that El Salvador serves as an inspiration for pioneering advancements in the digital assets sector.

The shift represents a substantial step forward for El Salvador’s ambitions to become a leading crypto center. Tether, one of the largest digital asset companies, reported an impressive $7.7 billion in net profits from cryptocurrency in the first nine months of 2024, which is approximately 20% of the nation’s yearly GDP according to IMF figures. This move could also present numerous benefits for Tether, taking advantage of El Salvador’s tax incentives designed to attract technology and crypto companies. The proposed relocation capitalizes on El Salvador’s new ICT Innovation Law, which offers a 15-year tax exemption for tech firms on income, property, and capital gains as highlighted by Matthew Sigel, head of digital asset research at investment firm VanEck.

In simpler terms, USDT (Tether) from Tether is the most widely used stablecoin and a preferred method for transactions and money transfers among individuals in developing nations.

In simple terms, the small nation of El Salvador, home to more than 6 million people, located in Central America, is quickly emerging as a hub for cryptocurrencies under President Nayib Bukele’s leadership. In 2021, it recognized bitcoin (BTC) as legal tender and established comprehensive regulations for digital assets, which has enticed various crypto companies to establish operations there. Additionally, El Salvador is a substantial holder of bitcoins, presently possessing over 6,000 BTC valued at approximately $550 million according to data from Arkham.

Last week, the video-platform Rumble (previously known as RUM) – which was recently invested in to the tune of $775 million by Tether – signed a contract for cloud services with the government of El Salvador.

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2025-01-13 22:05