Tether (USDT) Mints Another $1 Billion Unbacked Tokens on Tron (TRX) Network

Tether, the issuer of the largest dollar stablecoin, minted another $1 billion USDT on Tron (TRX). These tokens are not yet circulating and, thus, not fully backed

Stablecoin issuer Tether has minted another $1 billion USDT on the Tron (TRX) network, according to a report by Whale Alert. These tokens are yet to be fully backed by the company’s reserves.

The recent mint was spotted on the Tether Treasury wallet address, as highlighted by the Whale Alert account on X on July 15. Notably, Tether announced the mint as an “inventory replenish on Tron Network,” an “authorized but not issued transaction,” as explained by Paolo Ardoino, Tether CTO.

These are preparation mints when the stablecoin controller expects an increased demand for the token. The cryptocurrency market usually sees these movements as a signal that cryptocurrencies will soon rally.

As mentioned on Tether’s website, minted USDT for “inventory replenishment” that is “authorized but not issued” indicates that these tokens are not fully backed by real reserves like the U.S. dollar, U.S. bonds, or other collateral assets Tether claims to use.

“Tether tokens (USD₮) that are “authorised but not issued” are tokens that are created on a blockchain and sitting in Tether’s treasury. As these tokens have not been issued, these tokens are not counted as part of the total market capitalization of USD₮.

“Issued” USD₮ are authorized tokens that have been sold and issued to Tether’s customers and in actual circulation. “Issued” USD₮ are fully backed by Tether’s reserves.”

Justin Sun celebrates the USDT $60 billion milestone on Tron

In an interesting development, Justin Sun, the founder of Tron and a well-known crypto entrepreneur, celebrated the issuance of over $60 billion USDT on Tron. According to Sun, his network has become the first blockchain to achieve this milestone for a single stablecoin.

The issuance of TRON USDT has exceeded $60 billion, which is a significant milestone. We have also become the first blockchain with a single stablecoin surpassing $60 billion! #TRX #TRON https://t.co/AM8cK08npP pic.twitter.com/VsFVNGlo2g

Both the Tron Network and Tether’s USDT contribute a significant portion to the total volume, capitalization and liquidity of the cryptocurrency market. However, both have also attracted scrutiny from investors and regulators around the world, warranting caution.

For instance, BlackRock (NYSE: BLK) highlighted substantial risks pertaining to the crypto market’s heavy exposure to USDT in its ETF filings. Moreover, Circle, the issuer of USDC and a partner of Coinbase, openly urged the U.S. Congress to “go after” Tether.

The market now observes whether this $1 billion USDT mint will serve as a precursor to crypto’s next bull rally.

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