Tether Limited plans to invest $775 million into the video sharing platform Rumble in a partnership that aims to increase decentralization, according to an official press release from December 20, 2018.
The news caused a sharp spike in Rumble’s stock, which surged in after-hours trading, climbing 35.89% to $9.77 despite having closed the regular session down 1.1% for the day to $7.19.
The closing of the deal, depending on regulatory approvals, is estimated to take place in 2025’s first quarter.
Pavlovski will maintain control
Under the agreement, Tether will purchase 103.3 million shares of Rumble’s Class A stock. Rumble’s CEO Chris Pavlovski retains his supermajority of voting rights despite the sizeable investment. Tether does not represent itself on Rumble’s board.
Cantor Fitzgerald & Co. and Oppenheimer & Co. are advising Rumble, with legal counsel from Willkie Farr & Gallagher LLP. Tether is represented by McDermott Will & Emery LLP.
Rumble has said that it will allocate $250m from this deal in order to accelerate its growth plans and to consolidate the balance sheet.
The remaining funds will finance a tender offer for up to 70 million shares of Rumble’s Class A Common Stock, priced at $7.50 per share — the same rate as Tether’s investment. This move should provide liquidity to shareholders that choose to take part in the offering.
Pavlovski highlighted that crypto and the community of free speech are closely related, calling the partnership a good fit. The platform will be able to grow with the help of the investment. “next growth phase.”
Paolo Ardoino, CEO of Tether, has echoed this sentiment and cited Rumble as a viable alternative to traditional media platforms. He said:
“This investment reflects our shared values of decentralization and transparency. We anticipate collaborating on advertising, cloud services, and cryptocurrency payment solutions.”
Diversification efforts
The investment in Rumble is part of Tether’s broader effort to diversify beyond its core stablecoin business to better utilize its record profits and massive treasury.
Tether expanded its business in the last few months to include infrastructure projects, artificial intelligent, renewable energies, and platform-based peer-topeer communication. The company is launching initiatives to build Bitcoin mining facilities powered by renewable energy and investing in AI-driven cyber solutions.
Tether is also exploring blockchain-based networks for payments and supporting decentralized Internet infrastructure in order to minimize censorship. These ventures reflect Tether’s strategy to build a resilient digital ecosystem that aligns with its mission of promoting innovation, financial inclusion, and decentralization.
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