Thursday, Tether indicated that it would no longer support USDT present on Bitcoin (BTC), Kusama (KSM) and Bitcoin Cash (BCH). What’s really going on? Is this really the end of the famous stablecoin on the Bitcoin blockchain?
Tether unveils the end of USDT on 3 blockchains
Tether’s USDT, like many of its stablecoin competitors, is officially recognised by its issuer on several blockchains. In this particular case, nearly 83 billion dollars are spread across 15 different networks.
Nevertheless, USDT has more or less pronounced use cases on each of the blockchains covered, and it was in response to a lack of use that Tether announced the discontinuation of its stablecoin on Bitcoin (BTC), Kusama (KSM) and Bitcoin Cash (BCH):
Today Tether announces the ending of the support of 3 blockchains $USDt: OmniLayer, BCH-SLP and Kusama.
Customers will be able to continue to redeem and swap $USDt tokens (to another of the many supported blockchains), but Tether won’t issue any new additional $USDt on those 3… https://t.co/aghLgqtSuO– Paolo Ardoino (@paoloardoino) August 17, 2023
To be more precise about Bitcoin, this is USDT, which is in fact deployed thanks to the Omni Layer overlay, to the tune of 888 million dollars at the time of writing. On Kusama, this capitalisation amounts to 3.5 million dollars, and nearly 6 million on Bitcoin Cash’s SLP protocol.
The company refers to some difficult but strategic choices, particularly with regard to the challenges inherent in Omni Layer:
“It’s been a long time coming.
“This has led many exchanges to favour alternative transport layers, resulting in a decline in the use of USDT on Bitcoin using Omni Layer. As a principled organisation, we must remain consistent and transparent, and adhere to open processes, even if this means making difficult choices. “
Is this really the end of USDT on Bitcoin?
While the minting of new tokens was halted on Thursday, this does not mean that the USDTs on the blockchains concerned no longer have any value. And for good reason: users will still be able to transfer these assets from one network to another, and send them to the various platforms supporting the said networks.
In addition, the company announced in its press release that it would continue to guarantee USDT on these 3 blockchains on a one-for-one basis for the next 12 months.
Although USDT will disappear on Omni Layer, this is not the end of stablecoin on Bitcoin. In fact, Tether has indicated that it is taking a close interest in the RGB protocol, which is paving the way for decentralised finance (DeFi) on Bitcoin:
“We strongly believe that RGB will usher in a new era for digital assets, smart contracts and digital rights, with full support from the major players in our industry. Once USDT on RGB goes live, the world will see USDT on another super powerful and scalable Bitcoin layer. “
So this doesn’t really mark the definitive end of USDT on Bitcoin, and only shows that Tether is adapting to the changes of a still very young and evolving ecosystem.
