Tether Unveils Gold-Backed Synthetic Dollar, aUSDT, Revolutionizing Stablecoin Market

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In an exciting development on Monday, Tether, the company behind the issuance of the most significant stablecoin in the cryptocurrency arena, USDT, proclaimed a groundbreaking innovation – the inception of a novel synthetic dollar backed by gold. This innovative token, dubbed aUSDT, was masterminded utilizing the company’s unique platform, Alloy by Tether.

Utilizing the smart contracts feature found on the Ethereum Mainnet blockchain, users can create aUSDT by over-collateralizing it with another form of Tether token that embodies the value of gold.

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The development of this platform is attributed to Moon Gold NA S.A. de C.V. and Moon Gold El Salvador S.A., both crucial components of the Tether Group. This platform lays the groundwork for the new token that’s recently been launched.

CEO of Tether, Paolo Ardoino, sheds light on his vision for Alloy. In his vision, Alloy morphs into an open sphere for crafting collateralized synthetic digital assets. Moreover, it will soon align itself as a component of the company’s novel digital asset tokenization platform, which is slated for launch in the coming year.

Going further, Alloy is earmarked to kickstart a variety of “tethered assets,” with a high likelihood of including yield-bearing products. Ardoino assures the stability of these envisioned assets will be maintained through platform stabilization strategies such as over-collateralization with liquid assets and secondary market liquidity pools.

“We are thrilled to introduce Alloy by Tether, a new class of digital assets backed by gold and tethered to a reference fiat currency. Our strategy for stabilization, while distinct from traditional options like USD₮, marks an important milestone. We’re full of anticipation for how this innovation will come into play with the rest of the market. We’re also committed to integrating this sophisticated technology in our forthcoming digital asset tokenization platform,” said Ardoino.

Tether makes a grand entrance into the world of transactions and payments, as well. Tether Gold (XAUt), which serves as the underlying asset for aUSDT, holds a notable market capitalization approximating $573 million. The tangible gold underpinning Tether Gold is allegedly securely stored in the heart of Switzerland.

The gold-backed digital asset offered by the stablecoin issuer enables users to perform transactions, payments and remittances using a currency that closely resembles the US dollar. Simultaneously, it allows for the retention of ownership over these gold-backed digital assets.

While Tether has certainly chalked up substantial financial triumphs with its USDT stablecoin, amassing a staggering profit of $4.5 billion in the first quarter, it hasn’t been entirely without controversy. Concerns have been raised regarding the quality of supporting assets for stablecoins like the USDT from regulators.

However, after coming to agreements with the New York Attorney General and the Commodity Futures Trading Commission (CFTC) in 2021, Tether has successfully addressed allegations pertaining to reserves disclosure and transparency.

Looking at the broader picture, the introduction of a gold-backed synthetic dollar, aUSDT, signals a significant advancement in broadening Tether’s stablecoin options. Utilizing the Alloy by Tether platform, users can revel in a digital asset that strikes a careful balance between the stability of the US dollar and the inherent value of physical gold.

Present evaluations place the total crypto market cap’s valuation at a whopping $2.3 trillion.