Tether, the most valuable stablecoin in terms of market capitalization, is introducing a new digital asset that will be referred to as aUSDT.
This asset will be backed by over-collateralized Tether Gold (XAUT). The Alloy by Tether service includes a new category of tethered assets, and this is the first product that comes from that offering.
Using stabilization measures such as over-collateralization with liquid assets and liquidity pools in secondary markets, these assets are able to mirror the price of reference assets exactly. It is important to note that aUSDT is backed by XAUT, which indicates that the asset is supported by actual gold stores located in Switzerland.
At the moment, smart contracts developed by Alloy by Tether are being used on Ethereum (ETH), where a USDT can be generated by employing Tether Gold as evidence.
The chief executive officer of Tether, Paolo Ardoino, was quoted as saying that the novel approach represents an exciting milestone and that they intend to make it available in their next digital asset tokenization environment.
Tether’s market dominance is being challenged by competitors, according to data that was published by Kaiko Analytics more than a month ago. The announcement comes after the data was provided.
Last week, Tether Holdings Inc. has said that it intends to invest more than $1 billion in the fields of artificial intelligence and biotechnology.
