Tron Network to Receive $1 Billion Authorization of Tether (USDT)
Accounts monitoring blockchains have identified a $1 billion authorization of Tether (USDT) in Tether’s Treasury. This authorization is set to provide liquidity for the Tron network in the near future. WhaleAlert, a blockchain tracker, highlighted the authorization on X (formerly Twitter). Paolo Ardoino, Tether’s CTO, clarified that these USDT tokens would be used to replenish the Tron network and that it was an authorization, not an actual issuance. The allocated amount will serve as inventory for upcoming issuance requests and chain swaps from the Tron network.
What Does “Authorized but Not Issued” Mean?
Tether’s official FAQ page explains that “authorized but not issued” USDT is necessary to secure the creation and issuance process of tokens. By creating these authorized tokens, Tether reduces the number of times their signers need to access their authorization private keys, thus minimizing security threats. This authorization in the Tether Treasury allows instant issuance of USDT once customer funds are received, ensuring that Tether maintains 100% of its reserves.
Tether’s Market Capitalization and Competition
Tether’s market capitalization has exceeded $83 billion in 2023, with $16 billion in USDT minted since January. It remains the leading USD-pegged stablecoin by market capitalization. In contrast, Circle’s USD Coin (USDC) stablecoin has seen its market cap decrease from $50 billion to $26 billion due to the collapse of Silicon Valley Bank (SVB). Circle had $3.3 billion tied up in SVB at the time of its collapse in March 2023.
Hot Take: Tether Boosts Tron Network with $1 Billion Authorization
Tether’s recent $1 billion authorization of USDT in their Treasury is set to provide liquidity for the Tron network. This move highlights Tether’s commitment to supporting blockchain networks and facilitating efficient token swaps. By replenishing the Tron network, Tether ensures smooth issuance requests and chain swaps. With its significant market capitalization and ongoing minting of USDT, Tether solidifies its position as a leading stablecoin in the crypto market.
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