Tether has reversed its decision to freeze USDT smart contracts on five blockchains, saying tokens on those networks will remain transferable, though no longer supported for issuance or redemption.
Key Takeaways:
- Tether will no longer freeze USDT on five blockchains but has ended issuance and redemption on them.
- The affected networks, including Omni Layer and EOS, represent a small share of total USDT circulation.
- Tether is focusing on high-demand ecosystems like Ethereum and Tron, where most USDT activity now occurs.
The stablecoin issuer made the announcement Friday, citing feedback from ecosystem participants. The affected chains are Omni Layer, Bitcoin Cash SLP, Kusama, EOS, and Algorand.
“Tether has revised this approach and will not freeze the smart contracts on these networks,” the company stated, adding that users will still be able to move their tokens, but they will not be officially supported going forward.
Tether Phase-Out Hits Omni Layer with $82.9M in Circulating USDT
The change affects a relatively small portion of USDT’s total footprint. Omni Layer, once a primary vehicle for Tether, currently holds $82.9 million in circulating USDT.
EOS trails at $4.2 million, while the remaining networks each hold under $1 million, according to DeFiLlama.
Tether began winding down support for these chains in 2023, halting new issuance on Omni, Kusama, and Bitcoin Cash SLP last August.
EOS and Algorand followed in June 2024. The company’s revised stance keeps token transfers functional, but confirms it will not resume minting or redemptions.
The decision reflects Tether’s strategy to focus on chains with high demand and strong developer ecosystems.
Ethereum and Tron remain its largest hubs, with $72.4 billion and $80.9 billion worth of USDT issued, respectively.
BNB Chain holds $6.78 billion, while newer chains like Arbitrum, Base, and Solana are gaining traction, though they are more closely tied to rival stablecoin USDC.
The stablecoin sector has grown to $285.9 billion, with USDT and USDC dominating at $167.4 billion and $71.5 billion, respectively, according to CoinGecko.
Trump-Backed GENIUS Act Boosts U.S. Push for Dollar-Pegged Stablecoins
The shift also comes as U.S. policy support for stablecoins gains momentum. The recent passage of the GENIUS Act, signed by President Trump, aims to cement the dollar’s dominance by backing dollar-pegged stablecoins in global markets.
The Treasury Department expects the stablecoin market to exceed $2 trillion by 2028, a projection that places greater emphasis on liquidity, interoperability, and regulatory alignment across the ecosystem. Tether’s latest move underscores a pragmatic shift toward that future.
As reported, Ripple CEO Brad Garlinghouse has said the stablecoin sector is poised for explosive growth, projecting the market could balloon from its current $250 billion capitalization to as much as $2 trillion in the near future.
“Many people think it will reach $1 to $2 trillion in a handful of years,” Garlinghouse said, adding that Ripple is positioned to benefit from that trajectory.
Meanwhile, Western Union is positioning itself for a new phase of digital transformation, signaling strong interest in using stablecoins to modernize its global remittance operations.
CEO Devin McGranahan has outlined how stablecoins could streamline cross-border transfers, improve currency conversion in underserved markets, and provide financial tools for populations grappling with unstable local currencies.
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