Tether minted a new $1 billion batch of its stablecoin Tether (USDT) on the Ethereum blockchain on June 12. The stablecoin issuer’s latest $1 billion minting comes two months after the last minting, on April 21.
Tether’s CTO, Paolo Ardoino clarified on Twitter that the latest minting of USDT is part of what the firm calls an “inventory replenishment” on the Ethereum network.. The last broadcast, however, will not affect the global USDT market capitalization as the latest minting is an “authorized but unissued transaction”. According to Ardoino, the last minted amount will be used as inventory for the next issuance request period and inter-chain swaps.
PSA: 1B USDt inventory replenish on Ethereum Network. Note this is an authorized but not issued transaction, meaning that this amount will be used as inventory for next period issuance requests and chain swaps.https://t.co/Y1bqxZglgR
— Paolo Ardoino (@paoloardoino) June 12, 2023
An interchain swap is a process that traders use to transfer digital assets from one blockchain to another. This procedure allows traders to access other blockchains compatible with the cryptocurrency they own, allowing them to use their digital assets on multiple blockchains.
Ardoino explained that Tether regularly works with different cryptocurrency platforms to help them rebalance USDT liquidity across various blockchains.. For example, if a cryptocurrency exchange has a liquidity surplus of USDT on the Ethereum blockchain and a deficit on the Tron blockchain, where it needs to process withdrawals, the exchange will cross-chain swap your USDT from Ethereum to the blockchain. of Tron.
Tether has minted more than 16 billion new USDT in 2023, with a current market capitalization of more than $83 billion. USDT market dominance hit new highs in 2023 as other stablecoin issuers struggled due to the US banking and regulatory crises.
The USD Coin (USDC) issued by Circle—the second largest stablecoin by market capitalization—was on the verge of taking over from USDT as the largest stablecoin in 2022. However, the prolonged crypto winter and bank contagion in the United States significantly affected USDC market sentiment in 2023. Circle CEO Jeremy Allaire blamed the crackdown on cryptocurrencies by US regulators for the decline in prices. the market capitalization of the stablecoin.
Tether did not respond to Cointelegraph’s requests for comment prior to the publication of this article.
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