Tether mints $1 billion USDt on Tron, pays zero fees — Arkham

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As a seasoned analyst with years of experience in the cryptocurrency market, I find Tether’s recent move to mint $1 billion in USDT stablecoins on the Tron network intriguing. The fact that this large transaction incurred no fees is not surprising given the comparatively low fees on the Tron network, a factor that has made it attractive for stablecoin firms and beneficial for users in developing countries.

According to data from Arkham Intelligence, a firm that analyzes blockchain transactions, Tether generated $1 billion worth of Tether-United States Dollar (USDT) stablecoins on the Tron network without incurring any fees for this substantial transaction.

The analytics platform highlighted the November 14 transaction from a “black hole address” on Tron to Tether’s multi-signature wallet beginning with the characters “TBPxh.”

According to on-chain records, it appears that the $1 billion USDt was swiftly moved from the Tether multi-sig wallet to their Treasury, and remarkably, this transfer incurred no charges or fees.

In simpler terms, the relatively low transaction costs on the Tron blockchain make it appealing to companies dealing with stablecoins and beneficial for people in developing nations, as high network fees in these regions can substantially reduce the worth of a transaction or money transfer.

USDt supply on the Tron network

On Tether’s transparency site, it’s stated that a total of approximately $62.7 billion in USD-backed tokens (USDt) are authorized on the Tron platform. This amount is slightly lower compared to the Ethereum network, which hosts around $62.9 billion worth of these tokens.

Although Ethereum’s ecosystem is significantly larger than Tron’s, it’s interesting to note that both platforms have nearly equal amounts of stablecoins (USDt) in circulation. The substantial activity of these stablecoins on the Tron network was a major factor contributing to its impressive $577 million earnings during Q3 2024.

By August 2024, the Tron blockchain network claimed the second-largest portion (after Ethereum) in the stablecoin market, accounting for approximately 37.9%. Meanwhile, Ethereum held a commanding lead with roughly 55.7% of all issued stablecoins at that time.

In the very same month, Tether produced an extra $1 billion worth of USDt on the Tron blockchain. After minting the stablecoin, Tether CEO Paolo Ardoino stated that the additional USDt was intended to “refill” the supply and made it clear that the tokens had been authorized but not yet distributed.

These USDT tokens that have been authorized but not yet distributed are kept within the company’s reserves. They will only be put into circulation when a fresh issuance request is submitted, at which point they will become available for trading on the open market.

Traders dealing with digital assets often look at the increase in stablecoin circulation as an indicator of market sentiment and investor enthusiasm. When the number of newly created stablecoins grows, it suggests that traders are optimistic about price changes – a bullish sign. Conversely, a decrease in stablecoin supply could mean reduced interest and less market activity, which might be interpreted as bearish.

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2024-11-16 01:03