The company behind the issue of USDT stablecoin, Tether Holdings, has announced that it will work with a third-party exchange to convert 750 million USDT from Tron to Ethereum ERC20 via a chain swap. With a current market valuation of $83.37 billion, USDT is by far the most valuable stablecoin in existence. Stablecoin use has soared over the last few years, and Tether has been working hard to diversify its reserve holdings in response to the growing need for trust in the network. Related Reading: XRP Smothered In Red Despite Massive Whale Accumulation, Hinman Docs Release To maintain the liquidity of the stablecoin, cryptocurrency exchange Binance said through Twitter on Monday that it will arrange a swap of 750 million Tether-Tron token pairs for Tether-Ether. Tether has assured that the overall supply of USDT will not increase or decrease as a result of this. After 12pm UTC today, #Binance will be swapping 750M USDT-TRX for USDT-ETH directly with the Tether team to ensure stablecoin liquidity across all chains for our users. If you see any significant movements of USDT from our wallets today, that’s why. Funds are SAFU. — Binance (@binance) June 12, 2023 Tether Locks On 1:1 USD Anchor Tether, the most popular stablecoin, strives to keep a one-to-one exchange rate with the US dollar (USD) at all times. This token swap will involve Tron, the ninth largest cryptocurrency by market cap at $6.3 billion, and Ether, the second largest cryptocurrency by market cap at $210 billion, after Bitcoin. By exchanging bitcoin from one blockchain to another, or “swapping chains,” investors can get access to all of the blockchains that back the digital money they possess. Their digital assets can be used on other blockchains that support them. Related Reading: Solana Price Plunges Below March Low – Could It Drop Further? The move to rebalance the liquidity base of USDT on Ethereum by shifting from the region of surplus to the region of scarcity remains the most reasonable explanation of the various theories being put forward as to why the USDT is being switched. Meanwhile, the heightened regulatory scrutiny of Binance has been detrimental to the exchange, prompting this strategic shift. Binance is now engaged in litigation with the US Securities and Exchange Commission, highlighting the importance of taking preventative action in light of the current regulatory environment. ETH market cap currently at $210 billion. Chart: TradingView.com Restocking The Ethereum Network Inventory Binance, its CEO Changpeng Zhao, and Binance.US were all named in a lawsuit brought by the SEC last week. Binance has been accused of engaging in alleged deceptive activities, manipulating trading volumes, diverting user funds, and keeping the identity of those in control of the company in the United States a secret. Tether re-minted $1 billion in USDT on the Ethereum blockchain on Monday, prompting the swap. Tether’s CTO Paolo Ardoino tweeted that the recent $1 billion mint was part of the company’s effort to restock its Ethereum Network storage. In a related development, as of March, both the Tron Foundation and its creator, Justin Sun, were hit with fraud charges by the SEC. As a result, Binance USA announced that it will be pulling the digital asset token tron from its exchange. At the time of writing, Ether (ETH was trading at $1,744, down 6.33% in the last seven days, data from crypto market tracker CoinMarkeCap shows. Tether (USDT), on the other hand, is painted in red, and trading at $0.99. Source: CoinMarketCap Featured image from The Cryptonomist
