Title: “Why Tether is Terminating USDT Minting on the EOS and Algorand Chains”
Author: Zhang Joy, BlockTempo
The leading stablecoin issuer, Tether, announced a strategic shift yesterday (24th), prioritizing the issuance of USDT on blockchain networks with a community-driven focus. Tether stated, “At Tether, we are committed to maintaining a strong and innovative blockchain ecosystem for USDT and all other tokens we issue. To fulfill this commitment, we will continuously evaluate the current transport layer and strive to strike a balance between maintainability, usability, and community interests.”
Tether to Halt USDT Minting on EOS and Algorand
Additionally, Tether announced that, after careful consideration, they will suspend the minting of USDT on the public chains EOS and Algorand and continue to support protocols or public chains deemed useful by the community. The announcement states, “Starting today (June 24, 2024), Tether will cease minting USDT on EOS and Algorand. Over the next 12 months, Tether will continue to redeem USDT on EOS and Algorand as usual, and we will promptly announce any other changes following an evaluation.”
Why is Tether Abandoning EOS and Algorand?
According to the Tether official website, the blockchain networks currently used by Tether to issue USDT include Tron (TRON), Ethereum, Solana, Ton, Avalanche, Near, and more. Tron has the largest issuance on the Tron network, with a total issuance exceeding 59.8 billion USD. Ethereum, as the second-largest cryptocurrency, also has a close to 52 billion USD issuance. The resurrected popular public chain Solana has an issuance of approximately 18.9 billion USD. Even Ton, which only received Tether’s support this year, currently has an issuance of 5.8 billion USD. In contrast, EOS and Algorand, as established public chains, have only 85.2 million USD and 17.2 million USD in issuance, respectively, seemingly lacking attractiveness to users, which may be a reason for Tether’s abandonment.
On the other hand, there are speculations within the cryptocurrency community that, based on Tether’s wording in the announcement, “We will carefully evaluate the network’s security architecture to ensure the security, usability, and sustainability of the selected blockchain. Our goal is to allocate resources to places that can maximize security and efficiency,” Tether’s actions may also imply that the decentralization level of EOS and Algorand is not high enough, potentially posing regulatory risks for Tether in the future. However, this speculation has not been confirmed by Tether and is unlikely to be addressed by them in the future. Nevertheless, we can continue to observe whether Tether will continue to withdraw support for more public chains or add new ones.