Tether, the crypto behemoth behind the $137 billion stablecoin USDT, is establishing headquarters for the group in bitcoin-friendly nation state El Salvador, the company said on Monday.
The firm said the development came after acquiring all the necessary licensing as a stablecoin issuer in the country.
The move will see Tether relocate incorporated subsidiaries to El Salvador and create its first brick-and-mortar headquarters, a company spokesperson said. Previously most of the group’s entities have been incorporated and licensed in the British Virgin Islands (BVI), a source familiar with the company’s operations told CoinDesk. The move does not affect the company’s existing presence in Swiss crypto hub Lugano, the source added.
Two Tether-related companies — Tether NA El Salvador, S.A. de C.V. and Tether International El Salvador, S.A. de C.V. — obtained regulatory approval last August for most crypto-related activities in the country, according to the public registry of the National Commission of Digital Assets in El Salvador (CNAD), the government’s crypto regulatory body.
“This 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 in a statement. “El Salvador represents a beacon of innovation in the digital assets space.”
The relocation is a massive development for El Salvador’s aspirations as a crypto hub. Tether is one of the biggest digital asset companies and reported $7.7 billion in net profits for crypto in the first three quarters of 2024. That’s roughly 20% of the country’s annual GDP, per IMF data.
The move could also bring significant advantages for Tether, too, enjoying the country’s tax benefits aimed to attract tech and crypto firms. The “potential relocation leverages El Salvador’s new ICT Innovation Law, which offers 15-year tax exemption for tech firms on income, property and capital gains,” noted Matthew Sigel, head of digital asset research at investment firm VanEck.
Tether’s USDT is the largest stablecoin and popular payments and remittances vehicle for users in emerging countries.
El Salvador, a tiny country in Central America of over 6 million inhabitants, has become a nascent crypto hub under President Nayib Bukele. The country introduced bitcoin (BTC) as legal tender in 2021 and created comprehensive digital asset regulations attracting a range of crypto firms to settle. It’s also a significant bitcoin holder, currently holding over 6,000 BTC worth about $550 million, per Arkham data.
In other El Salvador news, Rumble (RUM), the video-sharing platform Tether acquired a stake in for $775 million, struck a cloud services deal with the Salvadorian government last week.