The chief technology officer of Tether, Paolo Ardoino, took to Twitter on June 12 to clarify that the $1 billion-worth Tether (USDT) mint is part of the firm’s “inventory replenish” on the Ethereum network.

Tether has recently minted USDT worth $1 billion on the Ethereum blockchain, which represents less than two months since its last billion-dollar mint on April 21. This time, however, the overall market capitalization of USDT will not be impacted since this mining is an “authorized but not issued transaction.”

Followed by a link which explains the idea behind chain swaps, Adriono tweeted the following:

“PSA: 1B USDt inventory replenish on Ethereum Network. Note this is a authorized but not issued transaction, meaning that this amount will be used as inventory for next period issuance requests and chain swaps.”

Chain swaps are essentially processes for traders which transfer digital assets from one blockchain to another. This allows users to access other supporting blockchains for the cryptocurrencies they hold, which enables them to utilize them on more than one blockchain.

Adriono explained the key advantages of using chain swaps to crypto media outlet Cointelegraph:

“Exchanges often find themselves in a situation where a majority of their Tether USDT tokens are held on one particular chain. Consequently, these third-party entities approach us to facilitate a chain swap, ensuring smooth and efficient operations.”

Sources:

https://crypto.news/tether-cto-says-1b-usdt-minted-on-ethereum-reserved-for-chain-swapping/

https://www.cryptotimes.io/tether-cto-explains-recent-1b-usdt-minting/

https://twitter.com/paoloardoino/status/1668165749926424580