Stablecoin issuer Tether has remained ambiguous regarding its stance on whether it will halt its support for the Tron network, following its competitor Circle's decision to cease minting stablecoins on the blockchain on Tuesday, February 20.
In response to queries about Circle's move and whether Tether was contemplating a similar action, the company provided a statement. Tether emphasized its issuance of tokens across various blockchains, which serve as the infrastructure for these tokens. The company underscored its authority to freeze transactions on each directly supported blockchain layer to fulfill compliance obligations, while assuring ongoing vigilance over the security of each supported layer.
Tether stands as the largest stablecoin with a market capitalization of $97.7 billion, surpassing Circle's USD token valued at $28 billion, as reported by CoinGecko.
According to Tether's transparency report dated February 21, the Tron network holds more than $51.8 billion in USDT, constituting over half of the nearly $101 billion in USDT tokens issued across various blockchains. Additionally, $76.2 million has been allocated for near-term liquidity provision on the Tron network. Tether's response followed Circle's announcement on February 20, declaring the immediate cessation of USDC minting on Tron and the gradual phasing out of support for the network. Circle stated this decision aimed to uphold the integrity, transparency, and security of USDC.
A United Nations report in January highlighted concerns about USDT on the Tron blockchain, identifying it as a preferred choice for cyber fraud and money laundering in Southeast Asia due to transaction ease, anonymity, and low fees.
Tether contested the report, arguing that it disregarded USDT's traceability and the company's track record of cooperation with law enforcement. Tether noted its freezing of over $300 million worth of USDT linked to criminal activities in recent months, including $225 million frozen in November 2023 as part of a U.S. probe into human trafficking rings in Southeast Asia. Additionally, the Campaign for Accountability, an ethics watchdog group, raised concerns about Tron's involvement in international law enforcement actions linked to significant sums from suspected organized crime groups and sanctioned entities. These developments are occurring amid the backdrop of a lawsuit filed by the U.S. Securities and Exchange Commission against the Tron Foundation and its founder Justin Sun in March 2023, accusing them of offering unregistered securities and engaging in manipulative trading, a charge Sun has refuted.
