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Tether approves $1 billion USDT for Tron network replenishment.

Tether Treasury has received attention from blockchain monitoring accounts, which detected a significant $1 billion authorization.

Tether’s Treasury holds this authorization with the intention of addressing the near-term liquidity needs of the Tron network.

WhaleAlert, a blockchain tracker formerly known as Twitter, highlighted the notable $1 billion authorization.

Paolo Ardoino, the Chief Technology Officer of Tether, promptly responded to clarify the purpose of the authorized USDT tokens.

According to Ardoino, these tokens will be utilized as inventory to restore and enhance the liquidity of the Tron network.

Importantly, Ardoino emphasized that this event represents an authorization rather than an immediate issuance.

The allocated amount will serve as inventory to meet upcoming issuance requests and facilitate seamless chain swaps within the Tron network.

According to Tether’s official FAQ page, the concept of “authorized but not issued” USDT plays a crucial role in ensuring the security and integrity of the token creation and issuance process.

This practice ensures that there is a reserved supply of USDT available for specific purposes within the Tether ecosystem.

By having authorized but not yet issued USDT, Tether maintains a level of readiness to meet future demands and execute necessary transactions on supported blockchain networks.

“By creating ‘authorized but not issued’ USDT, Tether limits the number of times Tether’s signers need to access their authorization private keys, thereby reducing their exposure to security threats.”

Tether USDT Authorization and Market Trends in 2023

To maintain 100% reserves and ensure prompt issuance of USDT, Tether authorizes funds in its Treasury once customer funds are received.

This practice allows for immediate issuance of USDT, bolstering the company’s reserve backing.

In 2023, USDT tokens issued on the Tron blockchain reached record highs.

The Tron network accounted for approximately $42.8 billion USDT in circulation, surpassing the approximately $39 billion USDT circulating on the Ethereum blockchain.

Blockchain trackers have detected significant USDT authorizations, including a notable $1 billion USDT mint in June 2023 to facilitate Ethereum chain swaps, as explained by Tether’s Chief Technology Officer.

Tether increases USDT supply in 2023.
Tether increases USDT supply in 2023.

Tether’s market capitalization has exceeded $83 billion in 2023, with approximately $16 billion in USDT minted since January.

USDT maintains its position as the leading United States dollar-pegged stablecoin in terms of market capitalization.

In contrast, Circle’s USD Coin stablecoin has experienced a decline in market capitalization from $50 billion at the beginning of 2023 to $26 billion at the time of this publication.

The collapse of Silicon Valley Bank (SVB) played a role in the decline of USDC’s market cap.

Circle had approximately $3.3 billion tied up in SVB when the institution collapsed in March 2023.

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