Tether minted a new $1 billion batch of its Tether (USDT) stablecoin on the Ethereum blockchain on June 12. The latest $1 billion minting for the stablecoin issuer comes within two months of its last minting on April 21.
Tether CTO Paolo Ardoino took to Twitter to clarify that the latest minting of USDT is part of what the company calls an “inventory replenishment” on the Ethereum network. However, the latest issuance will not affect the overall 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 period of issuance requests and on-chain redemptions.
PSA: inventory replenishment of 1B USDt on the Ethereum Network. Please note that this is an authorized but not issued transaction, which means that this amount will be used as inventory for the issuance requests and chain redemptions of the next period.https://t.co/Y1bqxZglgR
— Paolo Ardoino (@paoloardoino) June 12, 2023
A chain exchange is a process that merchants use to transfer digital assets from one blockchain to another. This procedure allows merchants to access other supporting blockchains for the cryptocurrency they hold, allowing them to use their digital assets on various blockchains.
Ardoino explained that Tether regularly works with different crypto 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 on-chain exchange its Ethereum-based USDT to the Tron blockchain.
Related: Tether CTO at USDC depeg: ‘Bitcoin maxis was right all along’ | PBW 2023
Tether has minted over $16 billion of new USDT in 2023, with a current market capitalization of over $83 billion. USDT market dominance reached new highs in 2023 as other stablecoin issuers struggled due to the regulatory and banking crises in the United States.
The Circle-issued USD Coin (USDC), the second-largest stablecoin by market cap, came close to taking over USDT as the largest stablecoin in 2022. However, the prolonged crypto winter and bank contagion in the The US significantly affected the USDC market confidence in 2023. Circle CEO Jeremy Allaire blamed the crackdown on cryptocurrencies by US regulators for the stablecoin’s declining market capitalization.
Tether did not respond to Cointelegraph’s requests for comment by post.
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