Tether Mints Another $1 Billion in USDT on Ethereum Blockchain, Bringing 2023 Total to Over $16 Billion

Tether Mints Another $1 Billion in USDT on Ethereum Blockchain, Bringing 2023 Total to Over $16 Billion

Tether, the stablecoin issuer, has recently minted a new batch of $1 billion worth of its Tether stablecoin on the Ethereum blockchain. This marks the second $1 billion mint by Tether in just two months, with the total USDT minted in 2023 reaching over $16 billion.

According to Tether’s Chief Technology Officer Paolo Ardoino, the latest mint is part of an “inventory replenish” process on the Ethereum network. However, the overall market cap of USDT will not be affected by this minting, as it is categorized as an “authorized but not issued transaction.” Ardoino explained that the newly minted USDT will be used as inventory for future issuance requests and chain swaps.

Chain swapping is a method used by traders to transfer digital assets from one blockchain to another. This process allows traders to access different supporting blockchains for the cryptocurrencies they hold, enabling them to utilize their digital assets on multiple blockchains.

Tether periodically collaborates with various crypto platforms to rebalance USDT liquidity across different blockchains. For example, if a crypto exchange has an excess of USDT liquidity on the Ethereum blockchain but a deficit on the Tron blockchain, they can chain-swap their Ethereum-based USDT to the Tron blockchain to facilitate withdrawals.

In 2023, Tether has minted over $16 billion of new USDT, and its current market capitalization exceeds $83 billion. USDT has seen increased market dominance compared to other stablecoin issuers, who have faced challenges due to regulatory and banking issues in the United States.

The Circle-issued USD Coin (USDC), the second-largest stablecoin by market cap, was on the verge of surpassing USDT as the largest stablecoin in 2022. However, USDC’s market confidence was significantly affected in 2023 due to the extended cryptocurrency market downturn and banking concerns in the US. Circle CEO Jeremy Allaire attributed the declining market capitalization of USDC to the regulatory crackdown on cryptocurrencies by US regulators.

At the time of publication, Tether had not responded to Cointelegraph’s requests for comments.