The firm behind the largest stablecoin by market cap is launching a new digital asset backed by real gold.
USDT issuer Tether is announcing a new digital asset backed by over-collateralized Tether Gold (XAUT) called aUSDT.
According to the press release, aUSDT is the first product from a new line-up of offerings called Alloy by Tether.
“Alloy by Tether introduces a novel category of digital assets known as tethered assets, designed to track the price of reference assets through stabilization strategies like over-collateralization with liquid assets and secondary market liquidity pools.
This innovative approach provides consistent value and stability between the reference asset and its tethered counterpart.”
According to the announcement, aUSDT being backed by XAUT means the asset is backed by stores of physical gold in Switzerland.
Alloy by Tether smart contracts are currently employed on Ethereum (ETH) where aUSDT can be created using Tether Gold as collateral.
Says Tether CEO Paolo Ardoino,
“While the stabilization mechanism is different compared to traditional options like USDT, this innovative solution marks an exciting milestone, and we eagerly anticipate how it will interact with the rest of the market.
Moreover, we plan to make this innovative technology available in our upcoming digital asset tokenization platform as well.”
The announcement comes more than a month after Kaiko Analytics published data suggesting that stablecoin competitors are chipping away at Tether’s market dominance.
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Featured Image: Shutterstock/Titima Ongkantong
The post Tether Announces Launch of New Gold-Backed Stablecoin With Overcollateralized Reserves appeared first on The Daily Hodl.