What does Stablecoin Minting mean? What is the Meaning of Tether USDT Mint
What does Stablecoin Minting mean? What is the Meaning of Tether USDT Mint
When you saw the news about Tether minting $4 billion, you may have wondered “how does this work?” ”. In this library post, we will cover Stablecoins, what are stablecoins and why Tether is minting the new USDT.
What Happens When Tether Collapses USDT?
Tether buys USD from investors looking to enter the market and prints stablecoin USDT. At this point, individuals or organizations convert fiat currencies into “stablecoins”. The minting process (mint), which we have started to see frequently since 2020, generally represents the inflow of money into the market.
As of 2020, Tether began preprinting future requests. Tether CTO Paolo Ardoino described this situation as “inventory stuffing” and refers to USDTs that have already been inventoried for future demand but have not been activated. After each print, Tether CTO Ardoino does not forget to make a statement.
Tether maintains separate reserves for the Ethereum and Tron networks. USDT in existing reserves is waiting for companies/people to create demand. This fact reduces the USDT in stock. Once the previous printing stock runs out or runs low, Tether prints new USDT.
How Many USDT Are in Circulation?
The total stable market cap in the cryptocurrency market is $127 billion DefiLlama. Tether, on the other hand, has the highest portion in this market cap. Combined across all chains, Tether has a market cap of $88 billion across all chains. Tron Network has approximately 45 billion <TAG1 and Ethereum Network has approximately 36.5 billion USDT in circulation.
What are stablecoins?
One way to bridge the divide between cryptocurrencies and fiat currencies such as the US dollar is provided by stablecoins. Stablecoins are a unique answer to cryptocurrency volatility because price stability is built into the assets themselves.
These are price-stable digital assets that work like cash but maintain the mobility and utility of cryptocurrencies. Stablecoins can be divided into four main categories based on the collateral structure they use: fiat-backed, crypto-backed, commodity-backed and algorithmic.
What are the Most Popular Stablecoins?
As of 2024, there are approximately 200+ stablecoins today. Here are some of the most popular examples by popularity and market cap:
Tethering (USDT) is considered the world's first stablecoin and has the highest market cap among stablecoins, sitting at just under $90 billion as of October 2023. The break of its peg in May 2022 is considered a “watershed moment” in the history of stablecoins.
USD Coin (USDC) is a stablecoin representing tokenized US Dollars on the Ethereum (ETH) blockchain. It is managed through a consortium called Center, founded by Circle and Coinbase. Coinbase is one of the most well-known cryptocurrency exchanges and Circle is a peer-to-peer payments startup backed by Goldman Sachs.
Dai (DAI): On the Ethereum (ETH) network, DAI is a cryptocurrency managed and controlled by MakerDAO or DAO, a decentralized autonomous organization. One of the first examples of widely accepted decentralized finance (DeFi) is Dai.
Paxos Standard (PAX) Pax Dollar (USDP). A stablecoin with a value based on the US dollar located on the Ethereum (ETH) network. It is the native cryptocurrency of the NYDFS-regulated financial company Paxos.
PayPal, a payment processor, has partnered with Paxos to launch PayPal USD (PUSD), a stablecoin. PayPal USD (PYUSD), a stablecoin with a 1-1 value relationship to the US dollar and backed by dollars and other assets, was introduced by Paxos Trust Company. To maintain openness, Paxos will provide monthly asset reports and submit them to independent audits; The first proof of reserves declaration is anticipated in September 2023.
