Accounts monitoring blockchains for major mints, trades, and token transfers have detected a $1 billion Tether (USDT) authorization in Tether's Treasury, which is expected to offer near-term USDT liquidity for the Tron network.

The $1 billion permission on X (previously Twitter) attracted a rapid response from Tether chief technical officer Paolo Ardoino, who stated that the USDT tokens would be used as inventory to "replenish" the Tron network.

Ardoino said that the event was an authorization rather than a real issuance, with the assigned quantity set to serve as inventory for forthcoming Tron network issuance requests and chain swaps.

Tether's official FAQ website states that "authorized but not issued" USDT is essential to secure the token generation and issuance process:

“By creating ‘authorized but not issued’ USDT, Tether limits the number of times Tether’s signers need to access their authorization private keys, thereby reducing their exposure to security threats.”

Authorizing USDT in the Tether Treasury allows the company to instantly issue USDT as customer funds are received, ensuring that the issuer retains 100% of its reserves.

In 2023, USDT coins issued on the Tron network reached all-time highs. The network has $42.8 billion USDT in circulation, while the Ethereum blockchain has approximately $39 billion USDT in circulation.

Tether's CTO has detailed similar significant USDT authorizations that have been reported by blockchain trackers, including a $1 billion USDT mint to facilitate Ethereum chain swaps in June 2023.

Sources:

https://cointelegraph.com/news/tether-authorizes-1-b-usdt-to-replenish-tron-network

https://cointelegraph.com/news/trc-20-usdt-circulation-surges-to-record-high

https://cointelegraph.com/news/tether-billion-usdt-mint-on-ethereum-for-chain-swaps