Tether relocates to crypto-friendly El Salvador

Tether, the company behind the world’s largest stablecoin USDT, is making a strategic shift by relocating to El Salvador. The move aligns with the country’s pro-crypto stance and aims to foster innovation in digital finance.

Since its launch in 2014, Tether’s USDT has become the dominant stablecoin, widely used for transferring funds, making payments, and other activities. With a market capitalization of $141.3 billion at the time of writing, it plays a critical role in the crypto ecosystem. Stablecoins like USDT are pegged to a stable asset—in this case, the US dollar—to reduce volatility.

Tether is now preparing for a significant operational shift. Initially incorporated in the British Virgin Islands, the company has announced plans to move its headquarters to El Salvador, a nation that has embraced cryptocurrency.

A company that earns roughly the same profit as Goldman Sachs is relocating to El Salvador https://t.co/ufqmx2VrAv

— Erik Voorhees (@ErikVoorhees) January 13, 2025

The company stated, “Tether and its subsidiaries are about to complete all formalities to relocate to El Salvador, following the successful acquisition of a Digital Asset Service Provider (DASP) license and as a stablecoin issuer, marking a step in Tether’s journey to foster global Bitcoin adoption.”

Tether sees the move as an opportunity to cement its position in “one of the world's most forward-thinking markets” and to foster the development of “cutting-edge solutions more effectively in a dynamic environment where innovation thrives.”

El Salvador: A rising crypto hub

El Salvador, the first country to accept Bitcoin as legal tender, continues to make strides in digital finance. According to VanEck, 8% of Salvadorans used Bitcoin for payments in 2024. The firm noted, “While some international observers initially viewed this as a modest figure, we believe that it represents a meaningful step forward for a country with historically low rates of electronic payment adoption. The integration of Bitcoin into daily life is creating a foundation for broader acceptance and innovation in financial technology.”

Tether praised the country’s regulatory environment, stating, “El Salvador is rapidly establishing itself as a global hub for digital assets and technology innovation.” The company highlighted the nation’s favorable regulations and growing community of Bitcoin-savvy individuals as key factors in its decision.

President Nayib Bukele has been a vocal advocate of cryptocurrency. In November 2022, Bukele announced via X that the government would begin purchasing one Bitcoin every day.

We are buying one #Bitcoin every day starting tomorrow.

— Nayib Bukele (@nayibbukele) November 17, 2022

Paolo Ardoino, the CEO of Tether, expressed enthusiasm about the move, sharing on X, “El Salvador is the beacon of freedom and [President] Nayib Bukele is an inspiring leader driving the country with love, passion, and intelligence.”

Tether ♥️ 🇸🇻

Very excited for Tether group relocating in El Salvador.
El Salvador is the beacon of freedom and @nayibbukele is an inspiring leader driving the country with love, passion and intelligence.

Seguimos 🦾 https://t.co/42Y83ryEaE

— Paolo Ardoino 🤖🍐 (@paoloardoino) January 13, 2025

Anthony Pompliano, CEO and founder of Professional Capital Management, described the relocation as “one of those events that everyone underestimates today, but later it turns out to be more important than we realized.”

Tether relocating to El Salvador seems like one of those events that everyone underestimates today, but later it turns out to be more important than we realized.

— Anthony Pompliano 🌪 (@APompliano) January 13, 2025

James Seyffart, an ETF Research Analyst for Bloomberg Intelligence, highlighted the potential economic impact of this move. He noted on X, “This has to have a massive impact on El Salvador.”

Said same to clients earlier today but this has to have a massive impact on El Salvador. I mean the estimated GDP of El Salvador was $34 billion in 2023 according to the World Bank. Tether had a net PROFIT of $10 billion in 2024. That's insane. https://t.co/Wk3txAIfoo pic.twitter.com/pwWG34ruqp

— James Seyffart (@JSeyff) January 13, 2025

Matthew Sigel from VanEck added context, pointing out that Tether’s profit in 2024 was equivalent to 35% of El Salvador’s GDP.

Tether reportedly earned $10B in net income last year, about 35% of El Salvador GDP 🤯

Their potential relocation leverages El Salvador's new ICT Innovation Law, which offers 15-year tax exemption for tech firms on income, property, & capital gains (and includes blockchain… https://t.co/DDrdGURtuH pic.twitter.com/5V7baxRGJn

— matthew sigel, recovering CFA (@matthew_sigel) January 13, 2025

Despite the move, Tether plans to retain its predominantly remote workforce of over 100 staff. Co-founders and CEO Paolo Ardoino will be among those relocating to El Salvador.

As Tether establishes its presence in El Salvador, it anticipates closer collaboration with local communities, businesses, and government entities. This relocation could significantly shape the future of financial landscapes, both within El Salvador and globally.