Tether, one of the most renowned stablecoin providers, has announced the discontinuation of support for its flagship stablecoin, USDT, on the Bitcoin (BTC) blockchain, in an unexpected turn of events.
Tether Transitions from Stablecoin Variants
Tether gave the announcement in a release, stating that it would cease the issuance or “minting” of USDT tokens on the Omni which houses the BTC variant, Kusama, and Bitcoin Cash Simple Ledger Protocol (BCH-SLP) blockchains beginning from August 17.
Despite the cessation of minting, Tether said it is committed to maintaining its redemption mechanism for USDT-Omni, USDT-Kusama, and USDT-BCHSLP for a minimum period of 12 months.
This means that users holding these stablecoin variants can still redeem them for their underlying assets through the specified channels. Tether’s strategic transition is driven by an ardent belief in the transformative potential of blockchain technology and decentralized exchanges.
While the present circumstances have led to the decision to discontinue support for certain blockchains, Tether remains optimistic about the future. The organization said it is open to reevaluating issuing USDT on the Bitcoin blockchain via the Omni Layer should conditions become conducive.
Justifying the Decision
Tether’s recent decision to withdraw support for USDT on the Bitcoin blockchain has left many in the crypto community puzzled. This means that USDT tokens will no longer be issued or redeemable on the Bitcoin network until the specified time, a move that could have significant implications for traders and platforms that rely on USDT as a trading pair.
Tether’s official statement cites the “lack of significant traction” for the Omni Layer, built on top of Bitcoin as the reason for this decision. The decline in USDT usage on Bitcoin via the Omni Layer can be attributed to multiple factors, including the emergence of alternative transport layers and a lack of popular tokens on the Omni network.
While acknowledging the significance of this transition, Tether acknowledges the Omni Layer’s pivotal role in its formative years. Serving as the inaugural transport layer for Tether’s operations back in 2014, the Omni Layer, played a vital part in the stablecoin’s early evolution.
The contributions and innovations introduced by the Omni Layer team have indelibly shaped the crypto landscape.
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