Lutnik Cantor wants to use Tether to fund a $2 billion Bitcoin loan program
Funding for the Cantor program will start at $2 billion but could reach tens of billions.Cantor has a 5% ownership interest in Tether, valued at up to $600 million. Confirmed by the US Senate.
Cantor Fitzgerald is said to be planning a multi-billion dollar program.
According to people familiar with the matter, the proposed program would allow the financial services company's customers to borrow dollars using bitcoin as collateral, Bloomberg reported. Funding for the program starts at $2 billion, but could reach tens of billions.
While lending has yet to begin, it would be one of several financial contributions to the program if Tether participates. Cantor already manages most of Tether's assets through its custody business, bringing in tens of millions of dollars for Cantor each year.
Recently, Cantor reached an agreement with Tether to acquire a 5% ownership interest in statcoin, worth up to $600 million, according to The Wall Street Journal. According to the report, the announcement was made before Cantor's CEO Howard Lutnick was nominated as the US Secretary of Commerce.
A spokesman for Teter said his “relationship with Cantor is entirely professional” and that “Lutnik's participation in the transition team will in some way influence regulatory actions.”
“Show me the money.”
News of Cantor's plan comes as President-elect Donald Trump prepares to enter the White House in January and Lutnick was named Commerce Secretary last week.
Lutnick plans to step down from Cantor after the US Senate confirms his position to “comply with government ethics rules.” Currently, Lutnick oversees the company's relationship with Tether; But after removing himself, he passes this on to his colleagues.
Lutnick said he met Tether owner Giancarlo Devasini in the Bahamas in 2021 to find out if he had the assets. Speaking at a crypto conference in July, Lutnick said:
“I basically told him the line of motion. I said show me the money. And we got every penny, and they had every penny, but they had places where I was pretty goddamned.”
In January, Tether challenged a United Nations report that said the USDT was widely used for money laundering. Tether said it was “disappointed” by the United Nations review, which ignored what the stablecoin provider was doing to help developing countries in emerging markets.
In his response, Tether reiterated its cooperation with law enforcement and explained that Tether's transactions are available on the blockchain, which makes it an “unenforceable option for illegal activities.”
