Due to decreasing user demand, Tether has been compelled to halt the issuance of USDT on three blockchains: Omni, Bitcoin Cash, and Kusama. Concurrently, they are shifting their focus towards the development of the new RGB network – a smart contract system that can operate on Bitcoin’s Layer2 or Layer3.
On August 17th, Tether, a leading stablecoin company, announced the cessation of USDT issuance on the Omni, Bitcoin Cash, and Kusama blockchains due to a significant decrease in user demand.
Furthermore, Tether emphasized that while the USDT supply on the Omni blockchain is still substantial, the platform lacks the necessary crypto activities to sustain it in the long run. Consequently, the company has made the decision to halt issuance and recall stablecoins on these blockchains. However, Tether revealed that they would reconsider this decision if Omni’s activity increases in the future.
Notably, Omni is a protocol built on top of Bitcoin and was the first blockchain supported by Tether when they launched USDT back in 2014.
Users currently have a 12-month window to convert USDT on the Omni, Bitcoin Cash, and Kusama blockchains into cash or switch to the USDT version supported on 13 other blockchains. These include Ethereum, TRON, Solana, Avalanche, Tezos, Kava, EOS, Algorand, Liquid, Polkadot, Near, and Polygon.
According to Tether’s data, out of a total of 83 billion USDT issued, the amount of USDT on the Omni, Bitcoin Cash (SLP), and Kusama blockchains constitutes $239 million, $987,000, and $1.49 million, respectively.
However, the decision to temporarily suspend USDT issuance on these three blockchains will significantly impact the USDT supply, despite their relatively lower amounts compared to other blockchains like TRON ($43 billion USDT) and Ethereum ($38.5 billion USD).
This is because, according to current data, $888 million USDT is authorized on Omni, but over two-thirds of that amount remains unissued. A similar situation exists with Bitcoin Cash and Kusama. Specifically, $3.5 million USDT is authorized on Kusama, with more than half of that not yet issued. Nearly $6.0 million USDT is authorized on Bitcoin Cash, with around 85% of that amount still not issued.
Additionally, showing continued trust in Bitcoin, Tether is actively developing RGB – a smart contract system that can operate on Bitcoin’s Layer2 or Layer3. Once RGB is implemented, Tether promises to bring USDT back to a blockchain built on the Bitcoin platform.
In their Q2 2023 report, Tether disclosed that they had earned over $1 billion USD by holding a substantial amount of collateral assets for USDT in the form of US Treasury bills, with a value of over $72.5 billion USD. This helped the company’s surplus profit exceed $3 billion USD. During this time, USDT’s market capitalization also reached a new record of $83.4 billion USD, despite the challenging state of the cryptocurrency market.