The company behind the world’s largest stablecoin, USDT, Tether, considered launching its own Blockchain for a while. However, it now seems that this plan has been shelved. But why was this plan abandoned? The reason behind the decision is a simple economic equation. That is supply and demand. According to Tether CEO Paolo Ardoino, Blockchains will become almost like commodities in the future, and Tether did not find it logical to add a new Blockchain in this saturated market.
Blockchain Inflation in the Market
In the crypto world, there is fierce competition among entrepreneurs launching new Blockchains every day. However, Tether decided not to follow this trend. Although Tether is technically a strong company with a market value of $117 billion in the stablecoin market, it decided that launching its own Blockchain would not be the right move.
Tether CEO Paolo Ardoino commented on the matter, saying, “We are very good at technology. However, I think Blockchains will almost become commodities in the future. Launching our own Blockchain may not be the right move. There are already very good Blockchains available,” he said.
Tether’s Decision Seems Logical Given the Market Situation
According to DeFiLlama’s data, approximately 86% of the total locked asset value of $133.2 billion across 306 Blockchains is concentrated in just the top 5 Blockchains. Ethereum leads the market with a locked asset value of $87.7 billion. TRON manages 49% of Tether’s supply with a locked asset value of $8.1 billion. These figures clearly show why Tether decided against launching its own Blockchain.
On the other hand, Tether remains neutral regarding Blockchains. Ardoino states that as long as Tether’s stablecoin meets the highest security and sustainability standards, they will remain neutral about which Blockchain it operates on. Commenting on the matter, Ardoino says, “For us, Blockchains are just a transport layer,” noting that Tether is actually taking a different stance in the crypto world with this decision.
Tether’s striking decision shows that, unlike most companies in the crypto world, owning a Blockchain may not always be advantageous, especially when the market is this saturated.
