As a seasoned researcher with a keen eye for detail and a deep understanding of the crypto market, I find Tether’s decision to remain “blockchain agnostic” a strategic move that speaks volumes about their foresight and adaptability in this fast-evolving landscape.
Amid speculation that Tether, issuer of the largest stablecoin in the crypto market USDT, could launch its blockchain, the company’s CEO, Paolo Ardoino, has addressed the rumors with key details.
Tether Abandons Plans To Launch Own Blockchain
During an interview with Bloomberg News, Ardoino acknowledged Tether’s technical prowess while pointing out that blockchain technologies are increasingly seen as valuable assets or “commodities” within the market. According to Ardoino, this is due to the swift advancements in blockchain technology.
We are very good in technology, but I think blockchains will become almost a commodity in the future. Launching a blockchain ourselves might be not the right move. There are very good blockchains.
It’s worth noting that despite being a major player in the cryptocurrency market, Tether (USDT) has chosen not to develop its own blockchain network. As the most popular stablecoin with a market cap of $115 billion, USDT plays a crucial role as both an entry point and exit strategy for crypto trading.
From my perspective as an analyst, it appears that Ardoino’s statements imply that Tether values the security and longevity of their stablecoin above the advantages of having a unique blockchain infrastructure. In his own words, “For us, blockchains are merely transportation layers.”
The Dominance of The Big 5 Blockchains
The report further notes that the blockchain ecosystem is becoming increasingly diverse and competitive, with data from DeFiLlama showing that the top five blockchain networks control approximately 86% of the total value locked (TVL) across 306 chains.
These are the BNB Smart Chain, Ethereum, Polygon, TRON and Avalanche, with a significant amount of decentralized applications (Dapps) developed and contracts issued on the chains, according to DappRadarr data.
Despite Ethereum being the most widely used blockchain, it holds only about 66% of the total value locked ($87.7 billion out of $133.2 billion across all networks). Other platforms like TRON, which manages nearly half (49%) of USDT supply, have also emerged as potential competitors for Tether’s stablecoin.
As an analyst, I’ve come to understand from Angela Ang, a senior policy adviser at TRM Labs, that the long-term success of these blockchains hinges on their capacity to provide distinctive benefits, like speed, security, cost efficiency, or interoperability, which are currently lacking in the existing ecosystem.
By choosing to stay “agnostic towards blockchains,” Tether seems more concerned with promoting the broad acceptance and practicality of USDT, rather than linking their stablecoin exclusively to a particular blockchain platform.
As a researcher, I find myself in agreement with Ardoino’s perspective that the realm of blockchain technology is progressively maturing into a commodity market. It seems that Tether’s primary focus is on delivering a dependable and secure stablecoin solution, one that effortlessly interacts with an array of blockchain ecosystems.
Currently, the overall cryptocurrency market valuation has surged to approximately $2.135 trillion as of writing, marking an increase from Friday’s initial value of $2.09 trillion, following Federal Reserve Chairman Jerome Powell’s recent speech suggesting potential future reductions in interest rates.
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2024-08-24 01:41