Tether introduces aUSDT, its new overcollateralized synthetic asset backed by gold


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Tether, the stablecoin issuer, introduced a new product that is backed by tokenized gold.

In a statement on Monday, the company behind USDT announced the launch of Alloy, its new Ethereum network-based platform that gives users the ability to create tokens backed by XAUT, the stablecoin backed by Tether’s physical gold.

“Alloy by Tether is an open platform that enables the creation of synthetic guaranteed digital assets and will soon be part of the new digital asset tokenization platform to be launched later this year,” CEO Paolo Ardoino mentioned in a post on Twitter. 

The company highlighted that it aims to “redefine stability in the digital economy by combining the strengths of a stable unit of account with the security and reliability of gold,” as detailed in the release.

The initiative is part of a proposal by the company to introduce a new line of linked digital assets. The first to debut, and which will be available first, is aUSDT, an overcollateralized token backed by XAUT, meaning it is backed by real physical gold stored in Switzerland, Tether reported.

Investors can create aUSDT by depositing Tether’s XAUT tokens as collateral. XAUT, which tokenizes gold on the Ethereum network, currently has a market capitalization of $573 million, according to CoinMarketCap.

Tether has described USDT as a cryptocurrency ” designed to replicate the value of a U.S. dollar,” noting that it has an overcollateralized position, meaning that the amount of new tokens users can mint is capped at 75% of the collateral value, CoinDesk explains.

As part of the launch, USDT holders will be able to claim tokens aUSDT for free, the company announced on social media. A fund of 10,000,000 aUSDT will be allocated to this promotion. Tether has also said that its new platform could potentially offer yield-generating products in the future.

This product was developed in partnership with Moon Gold NA, SA de CV, and Moon Gold El Salvador, SA de CV, entities that are part of the Tether Group and will handle the issuance of assets, the company said in the statement. The entities are regulated by the National Commission of Digital Assets (CNAD) of El Salvador.

Tether’s new offering follows the company’s efforts to enhance its performance beyond the issuance of USDT, the world’s largest stable digital currency with a market capitalization of $100 billion.

Tether’s introduction of aUSDT and the Alloy product line represents a strategic expansion into new forms of digital assets that bring together the stability of traditional assets with modern blockchain technology, setting a new precedent in the digital currency space. Recently, the issuer has announced strategic investments in companies in various growth areas, including artificial intelligence (AI), biotechnology and Bitcoin mining. Ardoino announced that Tether will invest $1 billion in startups through 2025. 

The company’s latest announcements come on top of Tether’s record quarterly earnings recorded in the first quarter of 2024.

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