Originally published on: November 06, 2024
Stablecoin issuer Tether made waves in the crypto world with a significant cross-chain swap, transferring more than 2 billion USDt to the Ethereum network on Nov. 6.
The move entailed swapping 1 billion USDt from the Tron network, 600 million USDt from the Avalanche C-Chain, 300 million USDt from the Near Protocol, and 60 million USDt from the EOS network to Ethereum. This large-scale transfer was executed on behalf of an undisclosed exchange looking to shift their USDt holdings from various cold wallets to the Ethereum blockchain.
Despite the magnitude of the cross-chain swap, Tether assured investors that the total supply of USDt would remain unaffected. This reassurance comes amidst speculation sparked by a report from The Wall Street Journal suggesting a government investigation into Tether for alleged money laundering and sanctions violations.
In response to the market turbulence caused by this news, Tether CEO Paolo Ardoino revealed details of the company’s reserve assets backing the stablecoin at an event in Switzerland. These assets include $100 billion in US Treasury bills, 82,000 Bitcoin valued at approximately $6.2 billion, and 48 tons of gold.
In addition to the massive transfer and solid reserve backing, Tether also hit a market capitalization of $120 billion in October 2024, indicating increased trading activity in the digital asset markets.
While stablecoins like Tether are often viewed as tools for speculation, data from Chainalysis suggests they are increasingly being used as a store of value in economies with rapidly depreciating local currencies.
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