E143: USDT Founder: Bitcoin, Gold, Stablecoin, & Tether, the Most Profitable Company in the World

0:00How did you build the most profitable business per employee in the world? We are living in a moment where the interest rates are high. Up to 2022, interest rates were not high. So we could not predict that. All these situations are definitely helping our profitability. And we believe that expanding different areas will help our profitability long term. We need about$100 million in profit per employee per year. Yeah, it's... Paulo Ardueno, the CEO of Tether. The company behind USDT and one of the most profitable in the world. He's also the CTO of Bitfinex, a leading global crypto exchange. What the hell would you do with$20 million?

0:31You got them tomorrow. Tether made last year$13.7 billion, and this year we'll probably make the same. It's not about the money. It's about sending a message. The message that we want to send is that the mission of Tether is probably 100-fold from here. I think Tether has the capital, the philosophy, and the tech innovation to do whatever he wants. How much do you sleep per night? I try to sleep at least five hours per night, but the problem is that every one hour I wake up and check out notifications. Where did you start that? 11 years ago. Wow. Juventus do what Juventus do so well. They've won again.

1:05Juventus Football Club, together owns 10%. Why would a stable company invest in a football club? These companies have hundreds of millions of fans all around the world. So it's a simple way to reach people everywhere without distinction, rich or poor. There's a common pattern amongst my guests. They have something that happened in their life that gave them a chip on their shoulder. How much of Tether's mission today is linked to something that he might not have had when you were young? I think…

1:35Hi everyone! This is the little bit that I know none of you like that can help us make a huge difference for this show and we want to take it next. 71 % of the people who regularly watch When Shift Happens have not subscribed. And so all I'd ask you if you want to make a huge difference is the following. If you've seen this show before and you like it, help me, help my team. Hit the subscribe button and we'll continue to build this show for you. Thank you. I'm on matcha because if I take too much coffee, the caffeine kind of gives me anxiety and I'm kind of like, I don't have that. No, no, no.

2:07That's the Italian side. Yes, it's the Italian blood that dissolves the coffee and the caffeine. It brings it to every single body cell but I don't get affected on sleep. I don't sleep much anyway. How much do you sleep per night? So I have a very particular routine. So I try to sleep at least five hours per night, but the problem is that they are fragmented because I keep on the notifications. And so working, like every one hour, I wake up and check the notifications and then go to bed to sleep. Wow. So you have an alarm every one hour? We have the notification sound on? Yeah, always, all the time.

2:50Wow. When did you start that? 11 years ago. 11 years ago, you've been sleeping five hours a night with Rick every one hour. Yes. Do you do naps during the day? No, not even. No. No, I get, if I do naps, I get shit-faced. Oh no, I gotta do naps. Build different. Well, I mean, it's because of Bitfinex, right? I still run the exchange. And so the exchange requires to be up and running all the time. Absolutely. What is your mission? My mission is to create, so infuse stability in a world that is going towards darkness. I believe that, and kind of is weird, right? The success of Tether is directly proportional to the failure of many things in the world.

3:45if the world was fair on the financial side and if finance would be accessible normal things, we're not asking for the moon USDT would not have any reason to exist and the reason to exist of USDT is bringing stability to people in emerging markets and now I'm a developer of technologies I think we are building a tether among the best technology for telecommunications for social media and a few other areas, including energy and so on. And so we want to devote our resources in disintermediating many other industries and make them open, accessible, like what we did with USDT and finance. And that is basically our mission.

4:36The vast majority of the profits we make are not distributed to the shareholders. It's like 95 % of the profits are kept in a company invested in new things, new ideas to support our world. That is my mission. I don't have much hobbies. Actually, I don't have any hobbies. My hobby is like continue to think about this every single day. I'm real obsessed. I'm a guy that gets obsessed. And then, you know, I got down into the rabbit hole. And that's basically the entirety of my life now. You mentioned the darker times. you wrote while the world continues to get darker Tether will continue to invest part of its profit into safe assets like Bitcoin, gold and land Tether is a stable company what is the stable company?

5:24a journalist asked me how to define Tether in a few words and he tried to do it for me he said Tether is the stablecoin company and I said, no, is the stable company. I think the more technology is accessible to people, the more finance is accessible to people, there are less incentives for people to screw it up and create instability. So chaos derives and burst only if people are unhappy, if people are in a situation where their life is very, very difficult, right? So the more, of course, there are other reasons, but in general, the stability in the world is, in my opinion, linked to the fact that there is huge disparity and a growing disparity between countries, between certain worlds.

6:25And technologies is, for the last 20, 30 years, on one side, trying to fill the gap, but actually it increased the gap by a large factor. and finance as well. There are half of the population on the board does not have access to finance or in a stable way, does not have access to a bank account, not because there are bad people, just because they are too poor of interest to the banks. And so the people living in these countries, there could not be stability in certain countries in Africa, for example, or in Central America, because the entire incentive scheme, the entire access to any sort of technology or finance is completely skewed towards few people.

7:18Democratizing access to finance, but democratizing access to technology, so making technology peer-to-peer technology, decentralized technology, decentralized finance, peer-to-peer finance. I believe that the world will end up being more stable because if people have stability in their lives, within their families, within their communities, within their cities and countries, they have less incentive to create chaos. And so that is the mission of Tether and that is what stable company means. It's a stable company is a company that focuses on the stability of society as the ultimate goal. And we prove that we can build a company.

7:59It's not like wishful thinking. The more, so the, actually the more we work in that direction, the more we become profitable. That's kind of, that's why I define Tether is the once in a century company, not because I want to be pokey or arrogant. I mean, I think I'm not very much not that, but is the fact that Tether is the only company that the more it pushes for open source, for openness, for decentralization, for all that, the more it makes money. because the incentive of Tether is actually to have a broader user base using tools that provide freedom of finance, freedom of speech and all that.

8:38And the more this widespread, the more actually Tether becomes profitable. There's no other company in the world that actually is in this situation. All the other companies are trying to create a walled garden to engage their users in their platforms. Our platform is the world. And so that is the huge shift. there's a common pattern amongst my guests you have something that happened in their life that gave them a chip on the shoulder how much of Tether's mission today is linked to something that you might not have had when you were younger I think I'm a very lucky person my family was definitely not rich but the only, well not the only but the main thing that I believe I learned from my family is working very hard.

9:27It's, um, I remember, so my grandparents have, um, had, um, they're not here anymore, but they had a farmer in a small farm in Italy and they had this, uh, um, they, they were producing the best olive oil, the best tomatoes. They were taking, making, putting so much care in, in having the best tomatoes, the best sage rosemary asparagus that they could you know that was their passion they were dedicating their lives to it my grandfather was waking up at five and then taking a nap at one and then going back to up to evening and that was his life forever and he was very happy he did up to the uh he only did the elementary school but it was very good in math um and my parents worked My mother was teaching in the kindergarten and my father was just an employee in...

10:27He's an employee. They're both, I'm very lucky. They're both alive. But it was an employee because now he's retired at the local national energy company in Italy. And so, but after work, they were bringing us to do some sports and then we're going to the farm to help the grandparents. And so basically from, from morning to night, the, the routine was wake up, working, working hard and do something, but with extreme passion and never heard my parents complaining, my grandparents complaining. Um, they, that was their mission. Everyone should have, you know, it's a mission and it should be small or big.

11:04It doesn't matter as long as you, you are happy. And so work when people, sometimes people say, oh, but you work hard. No, I mean, I saw what working art means. I'm definitely not working hard. you started coding when you were eight yes how did that happen my father was working in at in the national energy company and in italy um the public companies were the first ones that started to deal with computers to in the effort of modernizing expediting the work you know italy is not known for the best bureaucracy, and is known for everything taking a long time. So in the effort of changing things, in the early nineties, the local energy company started to use computers.

11:56And my father loved that so much. And that he came when I was seven years old, he came back home with a computer and he told me, this is very expensive it's two salaries of course I couldn't for me one salary two salaries but he said it was very expensive and so don't break it and pay good attention and then of course as every single kid you know we had floppy disc and we were playing games but we couldn't afford much so we couldn't and games was not easy to find games was like 91 And, and 91 in a small place in Italy with 600 people. So that is my, my hometown. And so I, I started using the plane with a computer and then eventually I ran out of games and I said, I want to build my own, make my own games.

12:56And so then I asked my father to buy me a book on how to code the games. And then basically he said, well, Paolo, I. I can, but it costs 60 ,000 liras. There were liras till then. And are you sure? Because it's very expensive. I want to do it. And then he brought the book at home and I started learning and then I started coding. That became my passion. I did that throughout the university and basically till now.

13:31Quick one. I want to thank our partners who help us make this show possible. I'd like to thank our friends at Jupiter, the most used decentralized trading platform on Solana and the largest DAO in the world. Thank you to our friends at Paradex. It's official Perps DEX season and we've teamed up with Paradex, the leading perpetual decentralized exchange with zero fees, deep liquidity and privacy. Their season 2 runs through the end of January, so you do not want to miss that one. In addition, their flagship NFT collection drops in Q4 this year and we're giving you a chance to get one. Supply is limited, so hurry up and use the link below to get on the waiting list.

14:08And last but not least, thank you to Mantle, a pioneering on-chain economy dedicated to revolutionizing the future of finance and blockchain scalability and that seamlessly bridges traditional finance and decentralized finance. You wrote, coding is unlike any other form of expression, liberates the human imagination and enables us to build entirely new worlds with endless possibilities? Can you elaborate? Yeah, it's, I've been always a mess in any sort of art. I cannot, I mean, I'm a fine guitar player, although I don't play since many years, but everything else was a mess. You know, when you did the art classes and you had like technical design and technical like stuff.

14:59So every single one of my drawings ended up to be a mess. I was putting my arms everywhere, like the entire kina, the entire pencil was dragged all around the canvas. I was terrible, but even I cannot draw, I cannot paint, I cannot sing, I cannot do many things. And even in a basic form. but then and so people use art um to paintings and all that to express themselves to express emotions and i understood that my way to express myself and to invite people because usually when you do art and so on you would you do that and you invite people in your own world and to me i was able to create my own words and invite people into my world through coding you used coding to create stable coin what is a stable coin if you had to explain it to your mom

16:04easier like so people are used to cash that is the physical money a lot of money now is already digital so what you have in your bank account is digital money like a digital dollar that you have already or digital euro but that money stays confined in your bank servers. A stablecoin is a digital dollar that uses blockchain technology to be transferred, to be sent. So it can become borderless since blockchains are just big databases that can decentralize databases that are borderless, that are global. They are not sitting in one data center. they have, they are all around the world. So we use the best form of database for money that is a decentralized database to move dollars.

17:01Why are stable coins so important to our world?

17:07Stable coins are important because 3 billion people in the world don't have access to finance. They are the ones that live in high inflation countries. I mean, Europe has an inflation rate of 30%, 34 % per year. I mean, the official one, but like Turkey has 50%. And Nigeria is, I think is higher. And Argentina is at some point has like 200%. So these countries are in a very dire situation. And stable coin, like of course now in 2025, everyone is interested to stable coins, but, and in the US, in Europe, everyone wants to launch a stable coin as a way to make money because they understood. I mean, they looked at us and, oh, it's profitable.

17:58Then I wanted a stable coin myself. But the reality is that stable coins are much more important for the people than don't have access to the dollar. So if you live in the US, you have maybe one or two bank accounts, two credit cards, cash, cash app, Zelle, PayPal. while in your life, you rarely experienced issues for sending money. But there are, so in the United States and Europe, financial rails and financial technology is 90 % efficient. So everything works basically all the time. If you go in certain countries in Africa, the efficiency of financial rails is like 5%. So if you use a stable coin from 5%, you go to 60, 70%.

18:45While if you use a stable coin in Europe or in the United States, from 90%, you go to 92, 95. So there are much more gains in using stable coins in the emerging market. That's why for these people, it's life-changing because it brings them back into a world that is becoming more digital. So it brings them towards, the richer part of the world, it gives them, it opens more opportunities to the people that, even the people that are living in remote villages in Africa. Internet started to do that. Actually, Internet is a way to invite people in a global context, but Internet without access to finance doesn't matter.

19:36Even if you can browse Amazon and you can buy anything, there is no point. And so, yeah, I think stable coins are actually the ultimate social network in that sense, because social network money is, in my opinion, the ultimate social network because it's about human interaction, peer to peer interaction and includes in itself, contain in itself also both the sense of value and the information that you want to transfer. You mentioned before, you said Tether is the best business in the world. you said you wrote tether has a 99 profit margin how did you build the most profitable business per employee in the world um doing about 100 million dollars in profit per employee per year did you even think about that no no it's uh to run we i like efficiency you know everything that I do, I think why I need...

20:40So how can I make it better? How can I make it more efficient? And so up until two years ago, we were 40 people in Tether and now we are like... Actually, now we are like 250, 300 because we hired a lot of developers because we are expanding AI in all the other directions. But the core stablecoin is managed by one of the people.

21:04The... And the beauty of it is that, first of all, we are subject, we are living in a moment where the interest rates are high. Up to the 2022 interest rates were not high. So we could not predict that. I think very few could predict that. There was the pandemic, hard to predict. So all these situations are definitely helping our profitability. And we believe that expanding different areas that which we are doing will help our profitability long term to maintain this ratio. And yeah. Quick one. I want to thank our partners who help us make this show possible. Thank you, Trezor. My favorite cold wallet to store my crypto and make sure I sleep well at night.

21:53If you want to order a treasure wallet and sleep well at night too, you can use my promo code WSH10 to get a 10 % discount. Big thank you to Bitwise Asset Management for backing today's conversation. Bitwise is a crypto specialist asset manager with more than$15 billion in client assets across 30 plus crypto solutions, including ETFs, index funds, alpha strategies, staking, and more. However you like to invest in crypto, Bitwise has something for you. Thank you to our friends at SWE for supporting this show. SWE is a scalable layer 1 blockchain that's fast, secure, and affordable, built by previous Facebook developers, and that delivers the benefits of Web3 with the ease of Web2.

22:34Thank you to Story Protocol, the IP layer of the internet, for supporting today's conversation. Story is building an open system for creators to register, manage, and grow their IP on-chain. Whether you're building words, stories, or characters, Story Protocol gives you the tools to protect and expand your creative universe. To support this show, please check the sponsor links in the description down below. You just announced that you're exploring a 20 billion raise at a$500 billion valuation. What the hell would you do with$20 billion? You got them tomorrow. Well, Tether made last year$13.7 billion and this year we'll probably make the same.

23:17I'm going to use, maybe it's not the right context, but I will use anyway a quote that I like. It's not about the money, it's about sending a message. That is from the Joker in Batman. The reason why it's so important is because we, the message that we want to send is that the mission of Tether is probably 100 fold from here. So a guy, once I was in AMA, public AMA, and he asked me a question. I said, I'm a big fan of Peter Thiel. So I was reading the book from zero to one. Of course, Tether is not anymore a startup, makes so much money. So instead of saying from zero to one, from where you are from zero to 100.

24:03And I said, 0.25. I have it in my notes. The reason I said that is because it's not about how much money we are making. about, it's about the potential that I think we need to still to express that we have in our minds this opportunity. Again, I define Tether once in a century company or opportunity because I believe every company needs three things. Needs the philosophy. You need to have, in a sense, you need to have ethos or philosophy. You need to have a sense of direction, who you want to be and so on. You need to have the innovation. So you need to have the ability to innovate in tech or in other areas.

24:54And third, you need to have the capital. If you have, most of the companies have one or two out of three, because you can have, you can be the best innovator and do it for the right things, to have the right philosophy, but you don't have the money. So you need to raise money and go to a VC and I raise money. But the problem is that the VC has the incentive to make much more money than the one that invested in you. And so he, the ABC will derail your initial project, your initial philosophy, your initial idea of what you wanted to build. And I think Tether in this situation has the capital, the philosophy and tech innovation to do whatever he wants.

25:34And so I want, so the message we're giving is we have so much to demonstrate still. We have, we want to grow so much. our vision is incredible we want to have partners that are joining our company to help us build in that vision because it's so unique it's so powerful and we don't want to screw this up it's not about the money it's about sending a message you mentioned a movie you also mentioned you sleep five hours a night when do you have time to watch movies? so sometimes I watch snippets of movies but I try to watch like one movie per week. Yes. Okay, wow. Yes, otherwise like, because in a certain way movies are a representation of reality.

26:26You need to stay in touch with the world, right? I wish I could read more. I have more time to read. I wish I would have more time to listen to podcasts. probably I put it on 2x just to try to absorb as much as possible I think that would be interesting I'm thinking with our AI platform to create a summary like a podcast summary because there are many arguments that I'm interested in too and not definitely is hard to be able to follow all of them but yeah I wish I could definitely read more if I have more spare time. Tether invested in a company called Plasma, whose founder, Paul was on this podcast too.

27:14He's the one who helped us set this up. Great guy. Why is Plasma so important to the world that Tether invested in them? So there is, I think, Tether, USDT, is one part of the technology. And as I said, stablecoins are digital dollars that move on blockchain technology. And unfortunately, blockchain technology in the last many years has focalized itself on maybe the wrong incentives and the wrong things. So it was much more important for blockchain developers to be able to have a blockchain with a lot of hype and the ability to, you know, list meme coins as fast as possible, dog with hats and things like that.

28:11That is maybe fine for the short term. I don't like it at all, but, you know, surely some of these teams made money in the short term. but I think USDT is the living proof that if you create something that is useful for the real world then you can actually change the world and so I think that stable coins based or kind of single purpose blockchains I don't think Plasma is a single purpose but you know focus blockchains on stable coins that can make stable coins very cheap to transfer, they can make stablecoin easy to use. Like right now, for example, if you have a stablecoin on Ethereum, you need to buy ETH as a token in order to move USDT.

29:06We need to be better user experience. I think that after many, many years in this industry, the quality of the user experience is still very low because we focus on the wrong things. and we focused only on our own ecochamber that is geeks, basically, and people that have the time to spend to learn something new for greed. But the majority of the people, and that's the reason why USDT is so popular out there, is because USDT is not talking to people that want to speculate. It's not talking... There is an interesting statistic. 67 % of all the transactions that move USDT on blockchain only send USDT.

29:55Instead, only 10 or 20, it's 20 % of the transactions that involve other stable coins move also other assets. So it means that people that are using, most of the people that are using USDT are only using USDT because they want a dollar. instead the most sorry and the other statistic was actually 80 so it's reverse 80 of the people that move other stable coins also move other assets so it means that people that have other stable coins are also moving other um assets so they use basically other stable coins to trade and in d5 for example and that is something so i much more prefer to have tens of millions of people living in africa that 10 000 bankers uh living in in new york as my user base another investment that tether did was completely unrelated the juventus football club tether owns 10 why would a stable coin company invest in a football club there are multiple reasons First of all, both me and Giancarlo are big football fans of Juventus.