Blockchain
Tether, the largest stablecoin issuer, has minted 1 billion USDT tokens on the Ethereum blockchain as part of its “stock replenishment”.
While some see the minting of new USDT as a catalyst for increased cryptocurrency demand, Tether CTO Paolo Ardoino told The Block that new USDT tokens are being minted to support chain swap functions.
“Tether periodically partners with various third parties (exchanges, hedge funds, etc.) to help them rebalance the liquidity of their USDT across various chains,” Ardoino said. “Since exchanges support Tether USDT on multiple chains, for example, they may end up having the most [their] Bind USDT tokens to one chain (e.g. Tron), but they may need to process withdrawals for another chain (e.g. Ethereum). Therefore, such third parties are asking to proceed with a chain exchange.”
Chain swap refers to the process of transferring tokens from one blockchain network to another. The process allows users to bridge assets across multiple chains.
Tether’s second billion dollar USDT coin in recent weeks
This is Tether’s second USDT coin in less than two months. The stablecoin issuer slapped a billion USDT tokens on Ethereum in April. Minted USDT tokens sit in Tether’s treasury and are “authorized but not issued” and are therefore not part of the total market cap.
Tether remains the largest stablecoin issuer on all blockchains according to The Block’s Data Dashboard. USDT’s current total supply is over 83 billion tokens.