Tether Cuts Gold Traders Months After Hiring Them From HSBC
(Bloomberg) — Tether Holdings SA has laid off two senior precious metals traders, just months after they were hired from HSBC Holdings Plc to create what it calls “the best trading floor in the world for gold.”
Vincent Domien and Mathew O’Neill, who were hired by the El Salvador-based stablecoin issuer to build a gold repository worth tens of billions of dollars, have been released, according to people familiar with the matter.
The reason for their departure was not immediately clear. The pair arrives for Tether as the company caps a record year by buying more gold than almost any central bank. Tether, which employs approximately 300 people, has grown large enough that some analysts have noted its impact on the precious metal’s rally.
Domien and O’Neill were brought in to professionalize Tether’s bullion purchasing and help the firm generate revenue by actively managing its gold reserves. Hirings have been the talk of the gold market as Tether has become one of the largest holders of gold bullion outside banks and nation states by storing the metal in a former nuclear bunker in Switzerland.
Both Domien and O’Neill previously held senior roles at HSBC; Domien was head of global metals trading and O’Neill was senior salesman.
“Tether always strives to operate with a lean team and continually optimize our operations,” the company said in an emailed response to Bloomberg News’ questions about the departures. “We are building a cutting-edge gold team that leverages the expertise gained from all of Tether’s recent investments.”
Last year, a number of senior traders were kidnapped from banks that traditionally dominated the gold market. Trading firms have gone on a hiring spree, with Mercuria Energy Group acquiring Benjamin Binet-Laisne from Goldman Sachs Group Inc. and Gunvor Group hiring scores of traders from various firms.
Tether is the issuer of USDT, the world’s largest dollar-pegged stablecoin with circulation of approximately $184 billion. At the beginning of the year it held around 140 tonnes of gold, mostly to back USDT and its smaller gold-backed coin, XAUT.
The importance of Tether’s gold purchase became clear in March as the metal headed for its worst monthly performance since 2008. Gold fell along with stocks and bonds in a selloff triggered by the Iran war, as expectations for higher interest rates and sales by at least one central bank added to the pressure. While Tether’s long-held gold position remains highly profitable, declines in both the metal and Bitcoin will likely have weighed on its portfolio.
Tether said this month that it hired a large accounting firm to conduct its first full financial audit. Plans to raise up to $20 billion in external financing are on hold pending results.
–With help from Emily Nicolle.
(Updates to include more context about their role in Tether.)
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