Tether's Treasury Authorizes $1B USDT Boosting Liquidity for Tron Network
Summary:
Tether's Treasury is set to authorize $1 billion USDT to provide immediate liquidity for the Tron network. The authorization, highlighted on blockchain monitoring platform WhaleAlert, is intended as inventory for future issuance requests and chain swaps for Tron, explains Tether’s CTO, Paolo Ardoino. A peak of USDT tokens was issued on the Tron blockchain in 2023, with $42.8 billion in circulation on Tron and around $39 billion on the Ethereum network. So far in 2023, Tether has minted nearly $16 billion in USDT, influencing its market capitalization to exceed $83 billion. Meanwhile, the market capitalization of Circle's USDC stablecoin dipped following the collapse of the Silicon Valley Bank.
Token transfers and significant trades happening on blockchain platforms are tracked carefully, with one such activity highlighting a $1 billion commitment of USDT in Tether’s Treasury. This substantial block is expected to function as immediate USDT liquidity for the Tron network. WhaleAlert, the blockchain monitoring system, brought attention to this authorization on social network X, quickly prompting feedback Tether's Chief Technical Officer, Paolo Ardoino. He confirmed that the purpose of these USDT tokens was to function as a stock to "refill" the Tron network.
Ardoino clarified that this action was an authorization, not an issuance, with the designated amount intended to function as a stock for future issuance requests and chain swaps from the Tron network. He indicated that the $1 billion USDT was authorized for usage as a stock for the next phase of issuance requests and also for chain swaps on the Tron network.
As per Tether’s FAQ page, USDT that are "authorised but not issued" are necessary to ensure the smooth creation and issuance of tokens. This reduces the number of times that Tether has to access its private authorisation keys, therefore decreasing vulnerability to security threats. This authorization process allows Tether to release USDT as soon as customer funds are received to maintain a 100% reserve support.
USDT tokens released on the Tron blockchain reached a peak in 2023, as reported by Cointelegraph earlier. There are currently $42.8 billion USDT in circulation in the Tron network, compared to approximately $39 billion USDT circulating on Ethereum's blockchain.
Previously in 2023, Tether authorized a comparably huge amount of USDT that had been flagged by blockchain monitoring systems. Specifically, this was a $1 billion USDT mint designed to support Ethereum chain-swaps.
In 2023, Tether’s USDT supply increased and saw its market cap exceed $83 billion. This happened after the company minted close to $16 billion in USDT since the start of the year. USDT remains the top US Dollar-pegged stablecoin by market cap.
However, Circle’s USDC stablecoin saw a decline in its market cap from $50 billion at the beginning of 2023 to $26 billion at the time of press release. This dip in market capitalization is believed to be the result of the fall of Silicon Valley Bank (SVB), with Circle having $3.3 billion invested in the bank at the time of its downfall in March 2023.
Published At
9/19/2023 11:28:33 AM
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