Tether Burns 500 Million Tokens, Claims All Is Well

Blockchain, Investing, News | October 25, 2018 By:

Tether has announced on Twitter that it has burned 500 million of its US dollar-backed tokens. The tokens were held in an account called the “Tether Treasury.”

The company recently has seen a rush to get the USDT into the treasury, the pace increasing as Tether dipped below $1 USD. Suspiciously, the transfers came from an address controlled by Bitfinex, which has a stake in Tether and shares some management. Speculation was that Bitfinex was trying to push the rate back to $1. A published report indicated Bitfinex is one of Tether’s main customers.

As a result of the token burning, the tether supply in circulation is about a quarter of what it once was.

The Tether white paper indicated that USDT holders can redeem their tokens for US dollars directly with the company. Tether continues to state that every USDT token is backed by a US dollar deposit, a statement some have questioned. There are complaints that Tether is not fully collateralized and it is impossible to convert tokens to dollars.