Tether (USDT), who had recently experienced a drop of over 6% in mid-October, found itself destroying 500 million of their stablecoin.
The stablecoin, that had claimed to be pegged 1:1 with the US dollar, showed on the blockchain that a transfer of 500 million USDT from the treasury address of the token had been moved into circulation through the companies official USDT issuing address. After the transfer finished and was confirmed, the tokens were subsequently destroyed, immediately removing them from circulation.
October saw almost 800 million USDT being redeemed by the token holders, causing the fall in the stablecoins market cap. This left close to 1 billion of the tokens being held in the company’s treasury address, while they were still on the blockchain, they were out of circulation. After the destruction of the 500 million coins, the treasury is now sitting on roughly 467 million of the stablecoin.
Tether officially announced that the tokens have been destroyed, commenting:
“Over the course of the past week, Tether has redeemed a significant amount of USDT from the circulating supply of tokens. In line with this, Tether will destroy 500m USDT from the Tether treasury wallet and will leave the remaining USDT (approx 466m) in the wallet as a preparatory measures for future USDT issuances.
“Conceptually, the Tether issuance and redemption process is outlined in the Tether whitepaper, with issuances and redemptions visible through observing the Tether treasury balance on the OMNI blockchain.”