Cantor Fitzgerald, led by Trump's Commerce secretary nominee, struck deal to acquire 5% stake in Tether

Key Takeaways

Cantor moved to secure 5% of Tether ownership in a deal worth around $600 million.
The company’s CEO, Howard Lutnick, will resign from Cantor Fitzgerald upon his confirmation as Commerce secretary.

Cantor Fitzgerald, led by Donald Trump’s Commerce secretary nominee Howard Lutnick, reached an agreement to acquire a 5% ownership interest in Tether, according to a Nov. 23 report from the Wall Street Journal, citing business associates familiar with the matter.

The deal, valued at around $600 million, was revealed after Lutnick was named top economic policy official in the incoming Trump administration. The CEO of Cantor is a vocal supporter of stablecoins, specifically Tether’s USDT and Circle’s USDC.

“Dollar hegemony is fundamental to the United States of America. It matters to us, to our economy,” Lutnick said at the Chainalysis Links conference in April. “That’s why I’m a fan of properly backed stablecoins. I’m a fan of Tether. I’m a fan of Circle.”

Cantor Fitzgerald manages a substantial stockpile of US Treasuries that back the USDT stablecoin, which has exceeded $130 billion in market cap.

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The partnership, inked in 2021, is strictly professional, focusing on managing reserves rather than regulatory influence, a spokesperson for Tether commented before Lutnick’s nomination as Commerce secretary.

“The claim that Lutnick’s involvement in a transition team somehow translates [into] influence over regulatory actions is laughable,” said the Tether spokesperson.

Lutnick intends to resign from Cantor upon Senate confirmation of his role as US Commerce Secretary. He said he would divest his interests to meet government ethics standards.

Tether is under scrutiny for potential violations of money laundering and sanctions laws, the WSJ reported last month. The probe focuses on whether Tether’s USDT stablecoin has been used by third parties to fund illegal activities.

The company has denied the allegations, calling them “outrageous” and asserting that the claims are based on speculation without verified sources. CEO Paolo Ardoino referred to the report as “old noise.”