Tether Cancels Plans for Its Own Blockchain
The company issuing the world’s largest stablecoin, Tether Holdings, has announced that it will not pursue its plan to launch its own blockchain. This is due to the current market situation and the competition in the blockchain sector as a whole.
Paolo Ardoino, the CEO of Tether, said in an interview with Bloomberg News about the company’s decision to focus on the importance of the company. Ardoino went so far as to say that adding a new chain might not be beneficial even though USDT has the technical means to do so because the blockchain space is already full.
“We are very good in technology, but I think blockchains will become almost a commodity in the future,” Ardoino said.
Well-Established Blockchains Dominate the Market
Ardoino also pointed out that Ethereum and TRON are the giants in the space of blockchain technology. This makes it hard for the newcomers to come up with a substantial market share. In particular, Ethereum is the most valuable blockchain for it has a total locked-in value (TVL) of $87.7 billion, which gives it the top spot. TRON, another leading competitor, has a total of $8.1 billion in TVL and is responsible for almost half of the total USDT’s supply.
DefiLlama market records on the other hand point out that the top 5 blockchains control 86% of the total value that is locked across 306 chains hence the market is dominated by a few major platforms which only suggest that launching a new blockchain would be such a nuisance.
Tether’s Focus on Security and Sustainability
Rather than creating its own blockchain, USDT aims to safeguard and make greener the USDT stablecoin on whichever blockchain the digital money will be trading on. Ardoino briefly explained the company’s strategy, saying “For us blockchains are just transport layers”
This modification embodies Tether’s unwavering intention of sustaining a resilient and secure infrastructure of USDT for the center of attention on the token’s utility at the already functioning blockchain.
Addressing Concerns Around Tether Reserves
Albeit having a major role in the crypto industry, Tether is still under fire about the quality of the assets underpinning USDT. Besides, a recent report from the United Nations indicated that Tron is popular in promoting cyber fraud and money laundering operations in Southeast Asia, thus raising questions about Tether’s activities. Tether, however, has countered these allegations, insisting that their tokens can be monitored while working with law enforcement agencies.
In order to facilitate education and awareness about digital assets, Tether joined forces with digital assets infrastructure provider Fuze earlier this year. The intervention is directed at prompting local financial institutions, providing better cross-border payment solutions, and thus, the development of regulatory frameworks (with a focus in Turkey and the Middle East).
Beyond this, Tether has launched an added service for Filipinos enabling them to pay for social security system (SSS) contributions using USDT. This new venture attests to Tether’s persistent efforts to make its stablecoin more able to be used in everyday spending.
