Crypto Updates

Tether authorizes $1B USDT to “replenish” Tron network

Tether authorizes $1B USDT to "replenish" Tron network

Accounts monitoring blockchains for major mints, trades and token transfers have flagged a $1 billion authorization of USDT in Tether’s Treasury that is set to provide near term USDT liquidity for the Tron network.

Blockchain tracker WhaleAlert highlighted the $1 billion authorisation on X (formerly Twitter), which drew a quick fire response from Tether CTO Paolo Ardoino who said that the USDT tokens would be used as inventory to “replenish” the Tron network.

Ardoino added that the event was an authorization and not an actual issuance, with the allocated amount set to serve as inventory for upcoming issuance requests and chain swaps from the Tron network.

As per Tether’s official FAQ page, “authorised but not issued” USDT are required to secure the creation and issuance process of tokens:

“By creating “authorised but not issued” USDT, Tether limits the number of times Tether’s signers need to access their authorisation private keys, thereby reducing their exposure to security threats.”

Having authorized USDT in the Tether treasury allows the company to issue USDT instantaneously once customer funds are received to ensure that the issuer maintains 100% backing of its reserves.

As Cointelegraph previously reported, USDT tokens issued on the Tron blockchain hit all time highs in 2023. The network accounts for $42.8 billion USDT tokens in circulation while the Ethereum blockchain has around $39 billion USDT circulating onchain.

Tether’s CTO recently explained similarly large USDT authorizations that have been flagged by blockchain trackers, with a $1 billion USDT mint to support Ethereum chain-swaps taking place in June 2023.

Tether increasing USDT supply in 2023. Source: Coinmarketcap

Tether has seen its market capitalization tip past $83 billion in 2023, having minted some $16 billion in USDT since January. USDT remains the leading US Dollar pegged stablecoin by market capitalization.

In contrast, Circle’s USDC stablecoin has seen its market cap decline from $50 billion at the start of 2023 to $26 billion at the time of publication.

The collapse of Silicon Valley Bank (SVB) is cited to have influenced USDC’s drop in market cap, with Circle having $3.3…

Click Here to Read the Full Original Article at News…