The company responsible for the most valuable stablecoin in the market is introducing a new digital asset supported by real gold.
Tether, the issuer of USDT, has revealed a new digital asset named aUSDT, backed by over-collateralized Tether Gold (XAUT). This new product is part of a series of offerings called Alloy by Tether.
Alloy by Tether is introducing a fresh category of digital assets called tethered assets, which are designed to mirror the value of reference assets through stabilization techniques such as over-collateralization with liquid assets and secondary market liquidity pools. This unique strategy ensures consistency in value and stability between the reference asset and its tethered equivalent.
The announcement states that aUSDT, backed by XAUT, signifies that the asset is supported by physical gold reserves in Switzerland. The smart contracts for Alloy by Tether are currently operating on Ethereum (ETH), enabling the creation of aUSDT using Tether Gold as collateral.
Paolo Ardoino, the CEO of Tether, expressed, “While the stabilization mechanism differs from traditional options like USDT, this innovative solution represents a significant milestone, and we are excited to see how it will integrate with the wider market. Additionally, we plan to incorporate this groundbreaking technology into our upcoming digital asset tokenization platform.”
This announcement comes shortly after Kaiko Analytics released data indicating that stablecoin rivals are gradually reducing Tether’s market dominance.
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