Tether, the stablecoin issuer, has decided to discontinue its versions on Bitcoin Omni Layer, citing limited user interest. The announcement on August 17 outlined that Tether's Bitcoin Omni Layer, Bitcoin Cash, and Kusama versions will all be phased out. The company clarified that it won't issue new Tether tokens on these platforms moving forward. However, redemptions will be facilitated for at least one year, with details for the redemption process after that period to be disclosed later this year
Bitcoin Omni Layer is a smart contract system built atop the Bitcoin blockchain. Tether's connection to it goes back to 2014 when it became the first stablecoin on the platform. While acknowledging Omni Layer Tether's historical significance, Tether explained that challenges stemming from the lack of popular tokens and the availability of USDT on other blockchains led to a decline in usage. Consequently, exchanges shifted to alternative transport layers, diminishing USDT Omni usage and prompting Tether to halt issuance.
Despite this, Tether left the door open for a potential revival of the Omni Layer version if its usage sees an uptick. The announcement also disclosed Tether's plans to introduce a new Bitcoin smart contract system called "RGB." the intends to issue a Tether version compatible with RGB, effectively bringing Tether back to the Bitcoin blockchain. In the ever-evolving landscape of stablecoins, Tether faces intensifying competition as new contenders like PayPal's PYUSD and Binance's FDUSD challenge its dominance in 2023.
