Popular stablecoin issuer, Tether, announced a monumental cross-chain swap recently, transferring over 2 billion USDt from various blockchain platforms to the Ethereum network. This mammoth move sees 1 billion USDt from the Tron network, 600 million USDt from the Avalanche C-chain, 300 million USDt from the Near Protocol, and 60 million from EOS being relocated to Ethereum. The move was performed on behalf of an undisclosed exchange aiming to shift their USDt holdings from safe but less accessible ‘cold wallets’ to the Ethereum blockchain. The swap doesn’t affect the total USDt supply, Tether ensures its investors.
This move is in the midst of an unverified report from The Wall Street Journal that claims the US authorities are putting Tether under investigation over suspected money laundering and sanctions violations. Following this news, the cryptocurrency market briefly took a hit as shockwaves of fear and uncertainty spread throughout its investors. Tether CEO Paolo Ardoino swiftly responded, and presented a detailed account of the company’s financial reserves supporting its stablecoin at a recent event in Switzerland.
The company’s reserves include approximately $100 billion in US Treasury bills, 82,000 Bitcoin, roughly valued at about $6.2 billion with the present market rates, and 48 tons of gold, which is currently experiencing record-breaking values at $2,790 per ounce. In October 2024, USDt reached an impressive market capitalization of $120 billion, which signaling increased trading activity in the digital asset markets and often overtures a positive outlook for asset prices. Despite this, data from Chainalysis suggests stablecoins are being utilized as value storage in economies experiencing rapid currency depreciation, rather than for speculative purposes.