The Dark History of the USDT Boss: From Selling Pirated Discs to Shaping the Global Financial Landscape

Hello everyone, we all know about Tether (USDT), but what you might not know is who its boss is. Today, I’m going to talk about this tough character in the cryptocurrency world—Giancarlo Devasini. This guy is not to be underestimated; he plays the game in a wild way!

Let’s start with his operations. After Bitcoin gained popularity, he directly set up a cryptocurrency exchange. You’d think that opening an exchange would be enough to make a fortune, but he wasn’t satisfied. To facilitate cashing out for various forces in the exchange, he also acquired a stablecoin issuance company.

What’s that like? It’s like running a casino, printing your own chips, and personally gambling. Isn’t that crazy?

This kind of play quickly got the attention of the U.S., which wanted to crack down on him. What happened? Devasini had a trick up his sleeve—he went on a buying spree of U.S. Treasury bonds, becoming the largest private holder of U.S. debt, which made the U.S. regulators ease up.

He controls the issuance rights of Tether, firmly establishing himself as the king of stablecoins globally. Now, the market value of the company that issues Tether exceeds $160 billion, but when he bought it ten years ago, it only cost him $500,000. The story here starts with his entanglement with Bitcoin.

Devasini was born in Turin, Italy. After graduating from university, he worked as a plastic surgeon for two years. Later, he made his first pot of gold by dealing in pirated discs across several European countries. Because of this, he was sued by Microsoft and had to pay 1 million Italian lira.

Now that he’s a top billionaire, this dark history is probably his most embarrassing moment. But then again, perhaps it’s this knack for exploiting loopholes that allowed him to spot the potential of Bitcoin early on.

Back in 2012, Devasini had failed several startups and was unsure of what to do next. At that time, Bitcoin was starting to gain global popularity. He jokingly posted online that he wanted to sell his 20 million pirated discs for 0.01 Bitcoin each.

Unexpectedly, many miners around the world were looking for places to spend their Bitcoin, and soon, all 20 million discs were snatched up. Luckily, he didn’t set the price at one Bitcoin per disc; otherwise, he might have ended up with all the Bitcoin in the world.

At that time, most people were treating Bitcoin as a novelty, but Devasini was different. He understood the scarcity and anonymity of Bitcoin and concluded that most people playing with it weren’t serious. Therefore, he believed that the main action in the cryptocurrency market would definitely be on trading platforms.

So in 2013, he found a newly established cryptocurrency trading platform called IFINEX in Hong Kong. At that time, Zhao Changpeng, who later founded Binance, had just started to get involved with Bitcoin!

IFINEX was registered in Hong Kong but based in the British Virgin Islands, primarily providing leveraged lending services to cryptocurrency players. Devasini invested money and became a major shareholder, also establishing a subsidiary called BIT FINEX. Just from the name, you can tell how optimistic he was about the Bitcoin market.

However, not long after, two incidents threw him into chaos. In 2013, Bitcoin’s price skyrocketed from just over $10 at the beginning of the year to $1,152 by the end, only to plummet to over $500 shortly after. This crash was mainly due to the ban on Bitcoin trading imposed by mainland China.

Not long after, in February 2014, a major incident occurred when the world’s largest Bitcoin exchange, MT.GOX, went bankrupt after losing 850,000 Bitcoins due to a system vulnerability, plunging the cryptocurrency world into a crisis of trust.

With increasing regulation and numerous platform vulnerabilities, the security and liquidity of Bitcoin were severely affected, and the price volatility necessitated timely liquidity. Therefore, the issues of security and efficiency in trading had to be resolved to gain user trust.

Just when Devasini was worried about this, a big opportunity fell into his lap.

In early 2014, a game company owner named Pierce was looking to sell his virtual currency company called TETHER. Why? At that time, the U.S. police had arrested a large number of cryptocurrency founders on suspicion of money laundering, and his company had issued a large number of Tether tokens.

Pierce originally dealt in virtual goods trading for games, with 400,000 players on his platform trading items, and he made quite a bit of money, being well aware of the process of converting virtual goods into real currency.

In 2013, he and two partners created a new cryptocurrency, Tether.

Tether not only had the privacy and liquidity that made it hard to regulate, but crucially, it was issued strictly according to a 1:1 peg to the U.S. dollar. The company would issue as many Tether tokens as it had U.S. dollars in its accounts, allowing it to replace the dollar for various virtual currency transactions.

At that time, not many people paid attention to this setup, but Pierce was worried. He feared that one day he might be called in for questioning, so he wanted to quickly offload the company at a loss.

At that time, Tether was considered non-compliant in the eyes of the authorities, making it hard to find a buyer. Coincidentally, Devasini didn’t care about these issues, and the 1:1 peg to the U.S. dollar was exactly what he wanted. This token, like Bitcoin, was a cryptocurrency, easy to trade and private, and with its value pegged, it had no price volatility—very stable.

So, Devasini spent $500,000 to acquire Tether, and a few months later, he launched Tether on his BIT FINEX trading platform.

Users could deposit U.S. dollars to exchange for equivalent Tether tokens, use Tether to buy Bitcoin or sell Bitcoin for Tether, and finally, Tether could be converted back to U.S. dollars at any time. This new exchange system made trading more efficient and private, and regulators were left powerless. With such a clever design, Tether quickly swept across all trading platforms.

Starting in 2015, the issuance of Tether grew exponentially each year. Surprisingly, the biggest demand for Tether didn’t come from cryptocurrency trading platforms but from cross-border payments.

Previously, cross-border transfers were complicated, slow, and had high fees, but Tether could be transferred in a minute and was basically free. Just think about it—how much demand there would be from businesses and groups needing cross-border payments.

But when demand exploded, Devasini faced a tricky problem: what to do with the massive cash reserves? After the market began to operate healthily, the volume of U.S. dollars exchanged for Tether far exceeded the volume of withdrawals, and the accumulated funds quickly reached the tens of billions of dollars.

Where to put this money and what to do with it? There were no current laws enforcing restrictions, and there’s a strange phenomenon in the cryptocurrency world: the less regulated and more opaque a platform is, the more popular it becomes. So, aside from buying U.S. Treasury bonds and some commercial paper, Devasini invested a large portion of the funds into Bitcoin speculation!!!

Outsiders questioned the authenticity and reliability of the reserves, but Tether and BIT FINEX were registered in the British Virgin Islands, a place known as a lawless land. Financial institutions in Europe and America could only voice their concerns but had no way to take action. Devasini even delayed third-party audits, claiming that the Big Four accounting firms didn’t want to work with him.

It wasn’t until 2017, under pressure, that BIT FINEX finally hired an accounting firm for an audit. The result showed that BIT FINEX had transferred $382 million to Tether.

Both companies were controlled by Devasini; BIT FINEX was a Bitcoin trading platform, and Tether was a stablecoin issuer. Wasn’t this just him moving funds from one hand to the other?

So, the promised 1:1 peg to the U.S. dollar became a joke? At one point, outsiders joked that Tether was actually pegged to Bitcoin, and some speculated that the volatility of Bitcoin was manipulated by Devasini behind the scenes. After all, he could issue hundreds of billions of Tether out of thin air to pump up Bitcoin, then quickly sell and profit, all without anyone being able to monitor it.

Faced with this public opinion, just as Devasini was about to argue, a serious incident pushed Tether into the spotlight. In 2018, BIT FINEX’s fund custodian, Crypto Capital, was investigated by multiple countries, and funds were frozen, leading to BIT FINEX being unable to settle $850 million in time, causing a run on the platform.

Devasini quickly transferred $700 million from Tether to BIT FINEX to help out, but this was done without shareholder approval or explanation.

This arrogant behavior made the U.S. authorities particularly unhappy because they were well aware of such tricks. Back in the day, during the Bretton Woods system, they created a scheme where $35 was pegged to one ounce of gold, making the dollar the global currency. People could exchange gold for dollars and vice versa, with the power to issue dollars firmly in their hands. This was almost identical to Tether.

The U.S. knew very well how they messed up the Bretton Woods system, so they would never allow Tether to operate behind the scenes like this.

In the following years, U.S. regulation intensified. In 2019, the New York Attorney General publicly stated that Tether and BIT FINEX were colluding with funds and revealed that no bank was willing to cooperate with Tether, claiming that the so-called 1:1 cash reserves were a scam, forcing Devasini to admit fault and pay a $18.5 million fine.

One would think that such negative news would bring Tether down, but surprisingly, the market and users didn’t care at all. Tether remained the leader among stablecoins. Clearly, with the U.S. crackdown, the world became aware of Tether’s lack of transparency, and even the U.S. could only threaten and intimidate without any substantial sanctions. This negative image instead became Tether’s golden trademark.

Starting in 2020, Tether was widely used in illegal activities such as telecom fraud, casinos, drug trafficking, and money laundering, causing significant trouble worldwide. According to statistics, in most underground banks and telecom fraud cases uncovered in our country, Tether was a major tool for cross-border fund transfers, being fast and hard to trace, adding considerable obstacles for the police.

Moreover, its so-called stability also came into play during the later Russia-Ukraine war. Whether it was the secret funding donations received by Ukraine or Russia’s attempts to bypass international financial sanctions to transfer funds, Tether was the first choice—efficient and reliable.

This dual-use tool has made countries around the world both love and hate it. The rapid growth of stablecoins has even weakened the traditional currency system, and if this continues, it could shake the foundations of traditional banking systems.

As a result, countries around the world have accelerated their legislative efforts regarding stablecoins, with the U.S. being particularly anxious, as stablecoins have the most significant impact on the dollar’s hegemony. However, the U.S. didn’t intend to suppress the development of stablecoins. After several years of research, in July 2025, Trump signed the “Genius Act” specifically targeting stablecoins.

This act is not about shutting down but about filtering. It stipulates that stablecoin issuers must be federally approved financial institutions and must have 100% reserve funds, subject to regular audits.

Clearly, the U.S. aims to exclude competitors, and Tether, registered in the British Virgin Islands, would not meet the requirements. However, if they moved the company to the U.S. and sincerely sought to comply, there might still be a chance. The U.S. has given Tether a tough choice, but Devasini had anticipated this outcome and began planning for self-preservation years in advance.

The custodian of Tether’s reserve assets is Wall Street investment bank Cantor Fitzgerald. The CEO of this company, Lutnick, was appointed by Trump as the U.S. Secretary of Commerce in 2023. Moreover, shortly before his appointment, Cantor Fitzgerald acquired 5% of Tether’s shares, creating a rather ambiguous political-business relationship.

Although this relationship may not directly grant Tether political protection, it also prevents it from being easily eliminated. To give the Secretary of Commerce face, Devasini directly authorized the use of most of the reserves to buy U.S. Treasury bonds.

According to Tether’s latest financial report, as of the end of the second quarter of 2025, Tether held $127 billion in U.S. Treasury bonds, making it not only one of the top ten non-sovereign buyers of U.S. debt but also the largest private institutional buyer of U.S. debt globally.

With this operation, Tether and the U.S. are now intertwined, though the public relationship appears straightforward, the behind-the-scenes connections are undoubtedly more complex.

Although the U.S. “Genius Act” sounds tough, Tether is still doing well and remains the leader.

Despite the U.S. wanting to support the second-place USDC, Tether’s leading position is very stable. If they were to take action to eliminate it, the entire cryptocurrency market could capsize.

The U.S. aims to gradually take control of Tether, but Devasini is Italian and may not be willing to be a puppet of the U.S., as such opportunities to compete for currency hegemony are rare.

Currently, it seems that this battle concerning the global financial landscape has just begun. Whether the strong will remain strong or the weak will rise, or if someone else will win unexpectedly, we’ll just have to wait and see.

But it doesn’t matter; it doesn’t affect my salary of 3,500 at all!!!

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