Tether Invests $102 Million in Argentina’s Adecoagro

Tether Holdings Limited, a British Virgin Islands business company behind the world’s largest stablecoin, has entered the agriculture and food sector for the first time by acquiring a minority stake of 9.8% (10,048,249 shares) in Adecoagro, a Latin American agricultural giant, and became the third largest shareholder in the company.

Tether made the investment between July 29 and August 16 of this year by purchasing shares worth about $102 million, offering $1.50 per share, in Adecoagro, which is listed on the Nasdaq stock exchange as AGRO, Tether disclosed in a filing with the US Securities and Exchange Commission (SEC) last month.

Tether said that it has used its own working capital to finance the latest investment, the filing showed. This also signalled Tether is on a diversification of its investment portfolio beyond the regular crypto and tech sectors.

According to the filing, the principal business of Tether Investments Limited is primarily to make strategic investments in emerging technologies, such as artificial intelligence and peer-to-peer platforms, sustainable Bitcoin mining operations, and digital education initiatives.

Tether Investments Limited is also involved in funding and supporting projects that enhance financial inclusion and build resilient financial infrastructure worldwide. Tether Holdings Limited is the holding company for the Tether Group, the filing showed.

Adecoagro is Argentina’s largest producer of milk and rice and it has a market capitalisation of around $1.2 billion, also farms and processes sugar cane and renewable energy in Brazil and plants crops such as soybeans and corn in Argentina and Uruguay. The company manages over 193,000 hectares of sugarcane crops in Brazil.

In a statement, Tether said that it views land as a crucial asset class, complementing its existing investments in Bitcoin and gold. Land is inherently scarce, provides long-term yield, and has historically served as a safe haven during periods of geopolitical instability.

According to media reports, as the stablecoin market continues to evolve with new entrants and record-breaking market capitalisations, Tether’s move could set a precedent for how cryptocurrency companies interact with and invest in traditional economic sectors.

This development, coupled with the rapid growth of the stablecoin market, underscores the increasing maturity and diversification of the cryptocurrency ecosystem. As competition intensifies and new players enter the field, the coming months will likely see further innovations and strategic moves in the stablecoin space, the reports said.

Partners with XREX Group

It may be recalled that Tether has invested $18.75 million in XREX Group, a Taiwan-headquartered cryptocurrency exchange, in the past. With the new funding, XREX Group plans to further facilitate cross-border business-to-business payments in emerging markets using USDT.

The Group is also planning to work with Tether to develop regulatory technology tools to detect and prevent the illicit use of stablecoins.

Tether is also planning to launch a new stablecoin linked to the UAE dirham (AED) by partnering with the UAE-based Phoenix Group and Green Acorn Investments. This new stablecoin will be backed by reserves from the UAE.