Tether CEO Paolo Ardoino Boosts USDT Supply with $1B Minting

According to CEO Paolo Ardoino, Tether, the operator of the largest stablecoin in the world, has authorized but not issued another billion USDT. Tether is the brand name of the cryptocurrency.

On December 25th, the blockchain tracking site Whale Alert sent a message on X (which was formerly known as Twitter) informing followers that Tether Treasury has successfully created one billion USDT, which is equivalent to one billion dollars.

In a subsequent response, the CEO of Tether, Ardoino, issued a public service announcement within the X thread of the Whale Alert. In the statement, he stated that the transaction was an “inventory replenishment” on the Ethereum blockchain.

Ardoino stated that this transaction is authorized but not issued. During the subsequent period, this amount will be used as inventory for issuance requests and chain swaps. Inventory replenishment in traditional finance refers to promptly ordering goods from suppliers to meet customer demand and avoid stock shortages without accumulating surplus inventory.

In the context of Tether, the process of creating additional USDT that is then placed in Tether’s treasury inventory as “authorized but not issued” USDT is referred to as inventory replenishment. The frequently asked questions section of the Tether website states that these tokens are excluded from the total market capitalization of USDT since they have not been issued or released into circulation.

There is a total of $925 million worth of USDT that has been “authorized but not issued” on Ethereum as of December 26, 2023, as indicated by the data on the Tether Transparency page.

Issued USDT on Tron, Ethereum and Solana as of Dec. 26, 2023. Source: Tether Transparency

Ardoino’s most recent public service announcement (PSA) reuses verbiage from a previous one billion USDT mint that occurred in September 2023, when Whale Alert identified a very similar transaction.

On that particular occasion, Ardoino also stated that the USDT transaction was an authorization and not an actual issuance. Ardoino intended to use the allotted quantity as inventory for subsequent issuance requests and chain swaps on the Tron network.

Ardoino’s most recent public service announcement (PSA) and the lack of transparency linked with Tether’s allowed transactions that have not yet been released have raised suspicion among observers of the online sector.

“It would be interesting to examine the document or agreement and learn more about the individuals responsible for this Christmas miracle of creating one billion USDTs out of thin air,” one commentator commented, inquiring as to whether Ardoino is one of the individuals responsible for making choices of this nature.

Some critics speculate that the most recent minting of USDT will likely be used to boost the price of Bitcoin, as industry observers have linked the creation of Tether’s USDT to price manipulation. One of the commenters in the forum responded by saying, “Say it directly that you minted it to pump blockchain.”

Tether’s market value has reached new all-time highs through the year 2023, indicating that the cryptocurrency has had considerable growth over the past year.

According to data provided by CoinGecko, the market value of Tether has climbed by roughly 38 percent since January, going from $66 billion to $91 billion throughout this period.

Tether (USDT) one-year market capitalization chart. Source: CoinGecko

A decrease of almost 2% over the previous twenty-four hours has resulted in Bitcoin’s current price of $42,760. During November 2023, Tether attributed the increase in USDT to two primary factors. One of these reasons was the ongoing market enthusiasm around the potential approval of a spot Bitcoin exchange-traded fund.

This year, the company has been making significant strides in the realm of Bitcoin-related activities, including the disclosure of plans to begin purchasing Bitcoin to better manage its reserves and the commencement of various mining operations for Bitcoin.