Tether Unveils aUSDT: A New Gold-Backed Digital Currency For Payments – Details
June 17 2024 - 11:00PM
NEWSBTC
Tether, the issuer of the largest stablecoin in the cryptocurrency
market, USDT, announced Monday the creation of a new synthetic
dollar backed by gold. The token, aUSDT, was developed on the
company’s Alloy by Tether platform. By leveraging smart
contracts on the Ethereum Mainnet blockchain, users can mint aUSDT
by over-collateralizing it with another Tether token representing
the value of gold. Tether Launches Alloy According to the
announcement, Alloy by Tether, developed by Moon Gold NA S.A. de
C.V. and Moon Gold El Salvador S.A., both members of the Tether
Group, serve as the foundation for the newly launched token.
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Time To Accumulate? In the words of Tether’s CEO Paolo Ardoino,
Alloy is an open platform for creating collateralized synthetic
digital assets and will soon be part of the company’s new digital
asset tokenization platform that will launch later this year.
Furthermore, Alloy enables the creation of various “tethered
assets,” potentially including yield-bearing products. The
platform’s stabilization strategies, such as over-collateralization
with liquid assets and secondary market liquidity pools, will
reportedly ensure the price stability of these assets. Ardoino
further stated on the matter: We are thrilled to announce the
launch of Alloy by Tether, introducing a class of digital assets
backed by gold and tethered to a reference fiat currency. While the
stabilization mechanism is different compared to traditional
options like USD₮, this innovative solution marks an exciting
milestone, and we eagerly anticipate how it will interact with the
rest of the market. Moreover, we plan to make this innovative
technology available in our upcoming digital asset tokenization
platform as well. Transactions And Payments Tether Gold (XAUt), the
underlying asset for aUSDT, boasts a market capitalization of
approximately $573 million. The physical gold that backs Tether
Gold is reportedly securely stored in Switzerland. The stablecoin
issuer contends that this gold-backed digital asset allows users to
engage in transactions, payments, and remittances using a currency
similar to the US dollar while retaining their ownership of
gold-backed digital assets. Tether has experienced substantial
financial success with its USDT stablecoin, generating a profit of
$4.5 billion in the first quarter alone, as reported in its
attestation. However, the quality of assets backing stablecoins
like USDT has faced increased scrutiny from regulators.
Incorporated in the British Virgin Islands, Tether reached
settlements with the New York Attorney General and the Commodity
Futures Trading Commission (CFTC) in 2021, resolving allegations
related to reserves disclosure and transparency. Related Reading:
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Overall, Tether’s introduction of a gold-backed synthetic dollar,
aUSDT, represents another milestone in expanding the company’s
stablecoin offerings. By leveraging the Alloy by Tether platform,
users can now access a digital asset that combines the stability of
the US dollar with the intrinsic value of physical gold.
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