Stablecoin issuer Tether has abandoned its plan to freeze USDT smart contracts on five blockchains, stating that the tokens will remain transferable but will no longer be issued or redeemed.
Tether announced on Friday that, after receiving feedback from members of these ecosystems, the revised plan will affect users on Omni Layer, Bitcoin Cash SLP, Kusama, EOS, and Algorand. "After receiving feedback from the communities of these deprecated blockchains, Tether has revised this approach and will not freeze smart contracts on these networks."
While users will still be able to transfer tokens on these blockchains, Tether is halting direct issuance and redemption on these chains. "This means that these tokens will no longer receive official support like other Tether tokens." Support was initially planned to end on September 1.
This decision aligns with Tether's broader strategy to focus on expanding support for crypto ecosystems with strong developer activity, scalability, and user demand—while not completely abandoning the chains it has long supported. Only a few layer-one blockchains based on smart contracts have successfully achieved large-scale user adoption and provided use cases, including TRON and Ethereum—Tether's two most supported chains.
According to DefiLlama, TRON and Ethereum have USDT supplies valued at $80.9 billion and $72.4 billion circulating on their respective chains, while BNB Chain ranks third with $6.78 billion.
Solana, along with Ethereum layer-two chains Arbitrum and Base, are other thriving crypto ecosystems with significant stablecoin activity, although they primarily use Circle's USDC stablecoin instead of USDT.
A review of USDT balances on the affected blockchains shows that Omni Layer will be the most impacted, holding a net circulation of $82.9 million in USDT, while other networks have smaller participation: EOS has $4.2 million, and the USDT values on Bitcoin Cash SLP, Algorand, and Kusama are all under $1 million.
Tether's plan to stop support for these blockchains has been in preparation for two years. In August 2023, the company announced it would no longer issue USDT on Omni Layer, Kusama, and Bitcoin Cash SLP. In June 2024, Tether will cease minting on EOS and Algorand.
CoinGecko data shows that the total market capitalization of stablecoins is currently $285.9 billion, with USDT and USDC leading at $167.4 billion and $71.5 billion, respectively.
Last month, U.S. President Trump signed the GENIUS Act, with many analysts stating that this will enhance the dollar's dominance by promoting dollar-pegged stablecoins, competing with other currencies, and strengthening the dollar's role as the world's primary reserve currency.
The U.S. Treasury expects the stablecoin market to grow to $2 trillion by 2028.
Related: Tether announces RGB protocol plan, $167 billion USDT natively launching on Bitcoin
Original article: “Tether Drops Plan to End USDT on Five Chains”
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