Tether ramps up USDT minting, adding 4 billion tokens in a month
Tether, the issuer of the world’s largest stablecoin, has increased its USDT token issuance, adding 4 billion USDT to the market over the past month. This surge in minting activity was reported by Whale Alert, a blockchain data provider.
The latest minting spree included 1 billion USDT on the Tron blockchain on November 10, closely following another 1 billion USDT issuance on Ethereum on November 9. Additionally, Tether issued 2 billion USDT in two separate transactions on the Tron blockchain on November 3 and October 19. This aggressive minting strategy reflects Tether’s efforts to meet the growing demand for stablecoins in the cryptocurrency market.
Paolo Ardoino, Tether’s CTO and new CEO, clarified the recent aggressive minting as an “inventory replenish,” indicating that these tokens are authorized but not issued. He added that the newly minted coins will serve future issuance requests and chain swaps.
USDT, pegged 1:1 to the US dollar, is the most popular stablecoin in the crypto industry. It plays a crucial role in facilitating trades on major exchanges, especially those that do not accept fiat currencies. The stablecoin’s dominance is further marked by its expanding market cap, which saw a steady rise from about $66 billion at the start of the year to over $87 billion as of November 14, 2023.
The scale of Tether’s USDT issuance is notable compared to its competitors. With over 35 billion USDT tokens on Ethereum alone, Tether surpasses Circle’s USDC, which accounts for less than 30 billion tokens, and Binance USD, currently holding under seven billion tokens.
Earlier in October, Tether said it will begin publishing reserve reports in real time in 2024. This move comes amid increasing regulatory scrutiny of the stablecoin industry and calls for greater transparency.
As it stands, Tether updates its reserve information once daily, as published on the issuer’s transparency page. Beyond this, the firm releases monthly reserve reports and conducts quarterly reviews.
In 2021, Tether faced a $42.5 million penalty from The Commodity Futures Trading Commission (CFTC) on charges that USDT, for a substantial duration (26 months) between 2016 and 2018, lacked complete backing.
Despite this setback, Tether’s growth trajectory has been upward. Per its recent quarterly attestation, Tether maintains a $3.3 billion liquidity buffer to ensure stability within the USDT ecosystem and foster trust among stakeholders.