Tether: $2 billion in swaps to Ethereum

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Tether has completed a two billion dollar swap. 

These are technical transfers of USDT tokens from other blockchains to Ethereum. 

The Tether swap to the Ethereum blockchain

As the company itself explained on its official X profile, tokens have been swapped from five blockchains to Ethereum.


The largest transfer was from Tron, amounting to one billion USDT.

Another 600 million have been transferred from Avalanche, followed by 300 million from Near. 

The rest were transferred from Celo and EOS. 

At the end of these swaps, the total number of USDT in circulation has not changed, but those in circulation on Ethereum have increased by two billion units.

The company has not explained the reasons for this swap, perhaps simply because it is a response to market demands. However, it certainly suggests that the role of Ethereum is growing, especially compared to that of Tron. 

The networks where USDT (Tether) is present 

USDT is a stablecoin token that exists on different chains. 

In total, as of today, there are approximately 121 billion USDT tokens in circulation, of which almost half (61 billion) are on Tron. 

Tron has long been the most used blockchain for transactions in USDT, as it has relatively low costs and is one of the most used layer-1s in the world. 

Of the remaining tokens, there are now more than 56 billion on Ethereum, the historical chain of USDT, even though it was not the very first to be used by Tether.

The first was indeed Omni, a sidechain of Bitcoin on which there are still 105 million USDT in circulation.

But the thing that surprises the most is not only that on Tron and Ethereum there are more than 95% of the USDT tokens in circulation, but that the third blockchain in this special ranking is not Solana. 

In fact, on TON, the blockchain of Telegram, there are now more than 1.1 billion USDT tokens in circulation, followed by Avalanche with 970 million and Solana only in fifth place with 810 million. 

On Near, 430 million remain and on Celo almost 150 million. 

What are Chain swaps? The explanation from Tether

Tether has also published an article on its official blog to explain in detail what these chain swaps are.

It is simply a process that moves criptovalute from one blockchain to another.

Furthermore, chain swapping can be used by USDT users to utilize their digital assets on blockchains other than those on which they hold them. 

Users who wish to perform chain swaps of small amounts of USDT must carry out the exchange on exchanges that support the token on the two blockchains between which they wish to perform the swap. 

Sometimes, however, it is the crypto exchanges themselves that turn to Tether to carry out this type of exchange, in case they have, for example, a surplus of funds on a given blockchain but a deficit on another. 

Tether also reveals that when customers request a chain swap for amounts that exceed the quantity of USDT held in their treasury wallets, they are forced to mint new USDT and transfer them to the destination blockchain. 

Once the minting and transfer are completed, they must burn the same amount of tokens on the initial blockchain, or keep these tokens in their treasury wallet on the initial blockchain to be used for future chain swaps. 

The market capitalization of USDT

Given that there are 121 billion USDT tokens in circulation, and since their market value is always more or less $1, the overall market capitalization of Tether Dollar is 121 billion dollars. 

This is the highest level ever reached so far, and it is 1.6% higher than that of a month ago. 

Note that a year ago USDT had a market capitalization of about 86 billion dollars, and two years ago about 68 billion.

The boom occurred between 2021 and 2022, when within two years the market capitalization of USDT went from 8 to 80 billion dollars. Subsequently, after the implosion of the UST stablecoin of the Terra/Luna ecosystem, Tether’s USDT fell to 65 billion, but within a few months it started to grow again. 

Currently, it holds 69% of the entire market capitalization of all stablecoins in the world, given that the second (USDC) capitalizes less than 37 billion dollars, and the third even only less than 5. 

The dominance of Tether in the stablecoin market is now almost total, also because USDT has practically never lost the peg with the dollar. 

In the past, doubts have been raised about its coverage, but by now it seems quite clear that USDT is even overcollateralized, meaning that Tether has reserves exceeding its overall market value.Â