Tether Plans $1B USDT Cross-Chain Swap to Tron Network

8 May 2024 Move2earn Digest

Tether reallocates $1 billion USDT to Tron without affecting the overall supply, enhancing network accessibility.

Tether’s USDT leads with a market cap of $137 billion and a 24-hour trading volume of $105 billion.

Holiday lull contributes to USDT’s drop in market activity; renewed momentum is expected in coming weeks.

, the company behind , the largest stablecoin globally, announced a significant chain swap on January 6 in partnership with a major cryptocurrency exchange. The operation reallocates $1 billion worth of USDT from multiple blockchains to the Tron network without affecting the overall supply of USDT.

The plan on Tether’s official X account indicates that a portion of USDT stored in cold wallets will shift to the Tron blockchain. This strategic move reflects Tether’s response to shifting market conditions, aiming to enhance accessibility for users across various networks.

Chain swaps serve a vital function in the cryptocurrency ecosystem. They allow seamless transfers of stablecoins between blockchains, providing traders with greater flexibility for transactions and trading on diverse platforms.

Tether’s Dominance in Stablecoins

Tether’s USDT leads the stablecoin market with a market capitalization surpassing $137 billion, according to . A recent 24-hour trading volume surged 65% to $105 billion, cementing its position as the preferred asset for payments, trading, and cross-border transactions. Pegged directly to the US dollar at a 1:1 ratio, it provides traders with a reliable shield against cryptocurrency volatility.

In contrast, Circle’s ranks second among stablecoins, holding a market capitalization of $45.79 billion and recording a 24-hour trading volume of $7.38 billion. Despite strong competition, Tether’s market influence remains substantial. However, regulatory changes in Europe are beginning to shape the landscape of stablecoins globally.

The European Union introduced the regulation in December, potentially impacting Tether’s market standing. While speculation grows regarding its implications, regulators have yet to clarify USDT’s compliance under MiCA, keeping the market alert for further developments.

Holiday Lull Slows USDT Activity — Not Bearish Sentiment

Market observations suggest that USDT’s drop in market cap and trading activity may also be seasonal. Matrixport, in a January 6 , noted that the holiday lull likely contributed to the slowdown rather than any bearish sentiment. “It may be premature to turn bearish,” the firm stated, predicting renewed momentum in the coming weeks.

Tether has executed similar chain swaps in the past. In early November, the company moved over from multiple networks to Ethereum. That operation included transfers from Tron, Avalanche C-Chain, Near Protocol, and EOS. Despite the scale of these operations, Tether reassured users that the total supply of USDT remains unaffected.

Tether Executes $2B Cross-Chain Transfer To EthereumTether recently executed a significant cross-chain transfer of over $2 billion in USDT to Ethereum from various networks, including Tron, Avalanche, Near Protocol, and EOS, on behalf of a large exchange consolidating its… pic.twitter.com/PDmFn7dZcc