Tether has minted $2 billion worth of USDT on the Tron blockchain to boost its reserves in anticipation of higher demand. The minting occurred in two steps, with the company’s CEO, Paolo Ardoino, confirming that $1 billion worth of the stablecoins was first minted before the second.
According to reports, the latest $1 billion USDT mint at Tether’s Treasury address was first brought to the public’s notice by Whale Alert on X. Paolo Ardoino explained that the USDT is “authorized but not issued”. Tether holds it in reserve for future use, like customer redemptions or moving tokens between blockchains. The decision to mint the $2 billion USDT on the Tron blockchain comes after the company minted $1 billion USDT on Ethereum on June 18 before the Federal Reserve’s FOMC meeting.
Tether prepares for rising USDT demands
According to blockchain analytics firm Lookonchain, the company is preparing in advance for expected demand because it is issuing large amounts of USDT without putting it directly into circulation. Stablecoins like USDT also lack the volatility of regular cryptocurrencies. They are common in market trends that Tether’s minting behavior follows, such as when investors increase their activity or when trading volumes spike on major exchanges.
Popular crypto investor and commentator Lark Davis said the minting meant that “dry powder” was entering the system. This means that there is still capital and it will be used once favorable market conditions arise. His comments show hope of an upcoming shift to a more risk-on investment environment if the Fed leans toward cutting interest rates or signaling continued support for financial markets. Tether continues to grow its reserves to support the stability and trust behind its popular stablecoin tied to the value of the U.S. dollar, USDT.
Reserves on the rise to keep USDT stable
According to previous records, minting more tokens and holding them in reserve gives users confidence that they can always redeem their USDT for dollars if needed because it proves each USDT in circulation is fully supported by assets of equal value. The most recent $2 billion minting happened on the Tron blockchain because Tron offers fast and low-cost transfers for users who need to move large amounts of money quickly and affordably.
Tether is also providing users with more ways to use the token and allowing exchanges and crypto to choose the network that best suits their needs in terms of speed and transaction fees by spreading USDT across multiple blockchains like Tron, Ethereum, and others. Tether’s CEO, Paolo Ardoino, said the newly minted USDT allows the company to respond faster to future demands from exchanges, institutional clients, or users who want to swap USDT between blockchains. This is because they are created in advance and held in Tether’s treasury as inventory.
The company also mentioned that it issues new tokens to ensure that its services are smooth, and not to influence or predict price movements in the crypto industry. However, there are still traders who believe that these mints happen before a major rise in the price of Bitcoin and Ethereum. Going by this logic, it means the assets could witness new rallies in the next few days.