What happened?
Tether has decided against freezing USDT smart contracts on five blockchains, including Omni Layer, Bitcoin Cash SLP, Kusama, EOS, and Algorand. Instead, while these tokens will continue to be transferable, the company will no longer support their issuance or redemption. Tether’s focus is shifting towards high-demand ecosystems like Ethereum and Tron where the majority of USDT activity currently takes place.
Who does this affect?
This decision primarily affects users and developers on the aforementioned networks. Omni Layer, once a significant platform for Tether, now holds $82.9 million in circulating USDT. EOS follows at $4.2 million, with the other networks each accounting for less than $1 million. However, users on these chains will still be able to transfer their tokens, even though official support is ending.
Why does this matter?
This move is significant in terms of market impact as it indicates Tether’s strategy to concentrate on networks with high demand and robust developer ecosystems. It also reflects the larger trend in the stablecoin sector, which has grown to $285.9 billion, with Tether’s USDT and rival USDC leading the market. The shift may increase liquidity, interoperability, and regulatory alignment across the ecosystem, aligning with anticipated trends in policy and market projections.