Tether Treasury is doing a rare USDT burn, which will see 64.6M USDT redeemed and then promptly destroyed.
Often we hear about Tether Treasury printing new USDT. However, it recently decided to cash out a significant amount of its stablecoin in a surprising move.
64.6M USDT Redeemed and Burned
64,600,000 USDT has just been withdrawn from Bitfinex to be cashed out into real dollars and then burned. The CTO of Bitfinex, Paolo Ardoino, has called it a redemption and says that “token excess will soon be destroyed.”
The move was picked up by Whale Alert (@whale_alert) earlier Monday morning.
Redemptions are not new for Tether Treasury, but this is a relatively large amount to be burned. It is unclear if Bitfinex itself is cashing out some USDT or if this is a collective pool of user funds that have requested to be redeemed into USD.
Although the 64.6M USDT is a tiny blip compared to Tether’s massive $4.6B market capitalization, most of the replies to the news have been bearish. Many are seeing the USDT burn as a clear sell signal, probably because they are so used to Tether Treasury printing new money. However, the amount is not significant enough to cause a market stir.
A Strange Coincidence
Coincidentally, Tether Treasury wasn’t the only entity burning their own stablecoin. Pax Treasury, for some reason, also decided to burn some of its own PAX tokens today. Whale Alert is reporting that around 1,044,444 PAX was burned.
It’s unlikely that the USDT and PAX burns are related at all, but the timing is curious, to say the least.
January has been a busy month for stablecoins in general. As BeInCrypto has previously reported, Bitcoin bulls got some momentum last week with a fresh minting of $20M USDC. The Coinbase-backed stablecoin is the second-largest on the market.