Tether mints $1 billion USDT on Ethereum, forecasting an ETF approval

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As a researcher with experience in the cryptocurrency market, I find the recent minting of $1 billion USDT tokens by Tether on the Ethereum blockchain intriguing, especially amid growing speculation about a potential spot Ethereum ETF approval. This is not the first time Tether has minted tokens during such hype around a possible ETF approval. In January, Tether minted $1 billion USDT tokens amid rumors of a spot Bitcoin ETF, and we saw similar price movements in Ethereum back then.

On Tuesday, Tether produced one billion US dollars’ worth of USDT tokens on the Ethereum blockchain, taking advantage of the mounting excitement surrounding the prospective approval of an Ethereum-based Spot Exchange Traded Fund (ETF).

As a crypto investor, I’m excited about the recent market surge, which seems to be fueled by optimistic expectations that the U.S. Securities and Exchange Commission (SEC) will give its green light to a spot Ethereum (ETH) Exchange-Traded Fund (ETF) for trading as soon as this Thursday.

As a crypto investor, I’ve come across some exciting news from Whale Alert regarding Tether’s recent minting activity on the Ethereum network. They reported this occurrence on Tuesday, and Tether CEO Paolo Ardoino subsequently confirmed it in a tweet. He explained that this was an “authorized but not yet issued transaction,” meaning that the USDT inventory has been replenished to the tune of $1 billion, which will be used for upcoming issuance requests and chain swaps.

Tether has previously produced new USDT tokens worth a billion dollars while there were rumors circulating about a Bitcoin spot Exchange Traded Fund (ETF). This event took place in January, and during that time, the Ethereum price fluctuated between $2,204 and $2,294.61.

Ethereum surging

As a researcher studying the cryptocurrency market, I’ve observed a significant surge in Ethereum’s value on Tuesday, with an impressive 15% increase. This upward trend isn’t unique to Ethereum, as other top-performing coins have also experienced notable growth. The primary reason for this price hike stems from heightened optimism regarding the approval of an Ethereum Exchange Traded Fund (ETF). Previously, the likelihood of such approval stood at 25%, but following Fidelity’s recent filing updates, it has skyrocketed to a robust 75%. Currently, Ethereum is trading at $3,726.78.

Some people believe that this latest Ethereum token minting could be a proactive step toward obtaining SEC approval for a spot Ethereum Exchange-Traded Fund (ETF). In response, Ivan Sherbakov, CEO of Cryptorobotics, hypothesized that these tokens may serve as liquidity to stimulate market activity prior to any ETF-related announcements.

Use cases for Tether

The rise in USDT tokens stored in Tether’s treasury, yet to be released, implies a significant influx of funds heading towards crypto markets, particularly Ethereum and its related coins. As stated on Tether’s Transparency page, approximately $87.8 million worth of these USDT tokens were present on the Ethereum network as of May 2021.

As a crypto investor, I’ve noticed some buzz in the market regarding Deutsche Bank’s analysis on Tether’s lack of transparency. Their concern is valid, given that if this stablecoin were to collapse, the repercussions could be quite severe due to its massive dominance in the stablecoin sector, currently valued at over $160 billion in total capitalization. With a market cap of around $111 billion, Tether controls approximately 70% of the market share.

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2024-05-21 23:33