Stablecoin issuer Tether, in collaboration with a leading cryptocurrency exchange, has announced plans to execute a $1 billion USDT chain swap. The swap will transfer the stablecoin from other blockchains to the Tron network, facilitating enhanced interoperability across supported chains.

Details of the Tether USDT Chain Swap to Tron Network

On January 6, Tether revealed via its X account that it is coordinating with a top third-party exchange to move $1 billion worth of USDT. The swap will involve transferring a portion of the stablecoin held in cold wallets to the Tron blockchain.

Tether’s stablecoin, USDT, is currently available on multiple blockchains, including Ethereum, Solana, and Tron. The issuer clarified that the process will not alter the total USDT supply but will ensure that liquidity is optimized across various networks. This mechanism enables traders and users to leverage their assets on any blockchain supported by the crypto firm.

Meanwhile, the stablecoin issuer recently joined the bandwagon of firms increasing their Bitcoin reserves, adding 7,629 BTC worth $705.25 million. The funds, transferred from Bitfinex after nine months of dormancy, bring Tether’s total Bitcoin holdings to 82,983 BTC. Acquired for $2.99 billion, these holdings are now valued at $7.68 billion, reflecting its growing Bitcoin strategy.

USDT’s Dominance in the Stablecoin Market

Additionally, USDT continues to dominate the stablecoin sector with a market capitalization exceeding $137 billion. Its primary use cases include payments, trading, and cross-border transactions. The stablecoin reports a 24-hour trading volume of $107 billion, reflecting a 69% rise in trading activity.

In comparison, USDC, the second-largest stablecoin by market cap, trails with a $45.8 billion market cap and a 24-hour trading volume of $7.1 billion. Tether’s ability to maintain stability pegged to the U.S. dollar has made it an essential tool for traders seeking to avoid volatility in the crypto market.

However, despite the growing dominance, Bitcoin critic Peter Schiff has accused Tether of market manipulation following its recent 7,629 BTC purchase. Schiff claimed that the stablecoin issuer mints USDT “out of thin air” to acquire Bitcoin, likening it to quantitative easing. While Tether backs USDT with reserves and conducts audits, Schiff continues to question its practices.

Role of Chain Swaps in the Crypto Ecosystem

Chain swaps play a crucial role in the cryptocurrency ecosystem by enabling seamless asset transfers between blockchains. This allows users to access liquidity and trading opportunities across multiple blockchains, enhancing market efficiency.

The stablecoin issuer decision to facilitate a chain swap to Tron underscores its commitment to maintaining liquidity across supported networks. The Tron blockchain remains one of the primary platforms for USDT, driving substantial trading activity.

Despite its dominance, the stablecoin issuer has faced challenges in maintaining its market cap. The introduction of the European Union’s Markets in Crypto-Assets (MiCA) regulation last December impacted the stablecoin’s overall market performance. 

The post Tether Plans $1 Billion USDT Chain Swap to Tron Network, Here’s All appeared first on CoinGape.

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Filed under: News - @ January 6, 2025 11:28 pm