*|MC_PREVIEW_TEXT|*KR SPECIAL SITUATIONS ALERT Versamet Royalties
(NASDAQ: VMET | TSX: VMET) Disseminated on behalf of Versamet Royalties (VMET.TO) |
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Most investors think Tether is a stablecoin company that happens to own some gold.
That's like saying Berkshire Hathaway is an insurance company that happens to own some stocks. Technically correct. Strategically blind.
I've been watching Tether's moves for over a year now. The Swiss vault. The $23 billion in bullion. The HSBC traders. You've heard me talk about all of it.
Now let me tell you what I think is really going on.
Because the Tether angle is bigger than most people realize, and it's the reason I'm so convinced of this name.
Tether doesn't want gold exposure.
They want a whole gold banking system.
They already have USDT, the world's most-used digital dollar. 534 million users, more daily volume than Mastercard. That's a global payment rail.
They built XAUT, a gold-backed token redeemable for a specific physical bar in a Swiss vault. That's a settlement layer.
They're buying physical bullion at 1-2 tonnes per week. That's a reserve base.
That's over $300 million a week in gold. Every week.
Tether's gold strategy chief was asked if they have a gold price target.
His answer: "We have it. We're not sharing it. You'd think we're crazy."
Ask yourself what kind of gold price justifies building an entire banking system around it.
A gold "bank" needs more than bars.
The only thing Tether was missing was a reliable, long-duration, scalable source of gold-linked cash flow.
It needs cash flow that's reliable, repeatable, and contractual.
They need royalties.
A royalty company doesn't mine anything. It holds contracts that pay a percentage of every ounce a mine produces, for as long as the mine runs.
High-margin cash flow is directly linked to physical gold production, with none of the operating risk.
When a buyer that large starts building, the market doesn't give you a polite RSVP.
It reprices first… and explains later.
Tether is buying shares of Versamet Royalties (NASDAQ: VMET)
They have accumulated over a $100 million position in Versamet. And they haven't shown signs of stopping.
Including buying CAD$21.7M in the most recent financing.
I was one of the first call and cheque writers when now Chairman Greg Smith started a company called Sandbox, which has now been rebranded as Versamet Royalties.
- Let's get into the team behind this.
- And one of the reasons why strategics, including Tether, have big stakes in the company…
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The CEO
Dan O'Flaherty built and sold Maverix Metals for $750 million. I told you his story on Day 1.
Every company he's run has ended up being acquired.
He reassembled most of his Maverix team, and they've deployed over $400 million across 28 assets since mid-2022.
If you're Tether and you're building a serious gold finance operation, you don't start with explorers and promoters.
You start with a team that's already built and sold a royalty business. They know the ins and outs of what makes a successful royalty and stream business.
Only invest with great people.
The Cap Table
B2Gold: 29%. This is one of the world's largest gold miners. B2Gold has a team of geologists who evaluate deposits for a living. When a company like that takes a 29% interest behind a single royalty vehicle, they're validating the business model, the leadership, and the assets in the portfolio.
That's the most expensive due diligence money can buy, and they've already done it.
Tether: ~13%. And here's the detail that tells me this is strategic. They acquired a block of shares that came with board nomination rights and contractual participation rights in every future equity raise, under certain conditions. - When Versamet closed a C$142 million financing with BMO running the book, Tether exercised those rights and wrote another check on top.
- And they just nominated a representative to the board of directors.
Passive investors don't do that. Strategic partners do.
Lundin family: 9%. The family dynasty behind some of the best known mines in the world. When they write a check, it's because they've looked the team in the eye and decided these are the operators who'll build the next great company. - I personally know the Lundin family and they are smart, aggressive, honorable and successful people. It doesn't get any better than having the Lundin family as shareholders.
Equinox Gold: 11%. Their co-founder and former CEO, Greg Smith, is Versamet's Chairman.
Over 70% of this company is held by people who build, finance, and operate gold mines for a living.
These are people who are serially successful and invested in the success of the company.
I consider Greg Smith not just a great business person, but I have worked with him directly over the last decade and he is trustful, moral, smart and gets the job done.
I consider Greg a personal friend and hold him in the highest regard. |
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The Numbers
Eight employees run the entire operation.
- $18.4 million in revenue last quarter alone — up 465% from Q4 the year before.
Run the annualized math yourself.
Versamet has seven producing royalty and streaming assets across four countries with production that hit 9,815 gold equivalent ounces in 2025, nearly double 2024.
And the pace is accelerating — 4,430 GEOs (Gold Equivalent Ounces) in Q4 alone.
More than DOUBLE Q3. At an average realized gold price of $4,145 per ounce.
The 2026 guidance is 20,000 to 23,000 gold equivalent ounces (called GEOs), another doubling.
At a conservative $4,000 gold price — well below current spot…
You can do the napkin math on what that cash flow looks like for a company.
That's with ONLY eight employees and no mine-level operating costs.
No mines to operate, no equipment to maintain, no labor force to manage. Just contracts that pay when someone else digs.
The Multiple
Versamet trades at just 11.3x 2026 forecast cash flow at the time of publishing.
Franco-Nevada trades at 24.8x. Wheaton at 22.3x. Royal Gold at 17.3x.
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Why the gap?
Most American investors simply haven't had the opportunity to buy it until now.
The company just got a U.S. listing.
No GDXJ index inclusion. A handful of analysts with Buy ratings, but still very much under the radar.
Yet.
All three are changing right now.
Every headline about Tether is about the vault.
The vault is a headline. The royalty stake is the strategy.
And if Versamet is the engine for what could become the first private gold banking system in history, 11.3x cash flow is a mispricing. |
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The full thesis is inside: assets, catalysts, risks, and the valuation math. Tomorrow... - Record revenues just posted…
- Tether gets a seat on the board…
And one mine just changed the math on everything I've shown you so far. Regards,
Marin Katusa and the KR Special Situations Team
Founder, Katusa Research |
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