Tether, the issuer of the world’s most used stablecoin, USDT, has announced plans to phase out support for its tokens on five lesser-utilized blockchains by September 1, 2025. This strategic move comes as part of the company’s broader shift towards more scalable and active platforms like the Lightning Network.
A Shift to New Horizons
The five blockchains affected—Omni Layer, Bitcoin Cash’s Simple Ledger Protocol, Kusama, EOS, and Algorand—were once part of the early fabric of Tether’s expansion but have seen dwindling activity in recent years. “Sunsetting support for these legacy chains allows us to focus on platforms that offer greater scalability, developer activity, and community engagement,” says Paolo Ardoino, CEO of Tether, underlining the rationale behind the decision. As of today, these networks host only a small fraction of USDT’s massive $156 billion market cap, which largely circulates on more robust networks like Tron and Ethereum.
USDT holders on the affected chains have been advised to redeem their tokens or migrate them to other blockchains, utilizing bridges or exchanges, before the cutoff date. This transition reflects Tether’s intent to align itself with more dynamic and future-proof platforms, which could better cater to the burgeoning demands of the cryptocurrency ecosystem. This strategic pivot mirrors trends seen in the broader stablecoin market, such as Galaxy’s EURAU to Set Alight EU Stablecoin Crypto Market, highlighting the ongoing evolution within the industry.
Implications for the Market
This move by Tether is a clear nod to the evolving landscape of blockchain technology. Layer 2 solutions, such as the Lightning Network, offer faster transaction times and enhanced scalability—features that are increasingly critical as the demand for stablecoins rises. By reallocating resources and focus, Tether is positioning itself to capitalize on these advancements and drive the next wave of stablecoin adoption.
Analysts see this as a strategic pivot that could set a precedent for other stablecoin issuers. “This realignment demonstrates Tether’s commitment to innovation and long-term sustainability,” notes blockchain analyst Jamie Wu. “It also underscores the importance of adaptability in this fast-paced industry.”
The impact on the five blockchains being phased out is yet uncertain. While they may experience reduced liquidity and activity, some experts believe this could spur innovation, pushing these platforms to diversify their offerings and explore new niches. This aligns with recent developments in the stablecoin sector, such as the Bitcoin Stablecoin Network Plasma Sets XPL Token Sale, which showcases the dynamic shifts occurring in the market.
Historical Context and Future Outlook
Historically, USDT has played a pivotal role in the crypto market, often acting as a haven for traders during volatile periods. Its dominance on platforms like Tron and Ethereum highlights the preference for networks that offer robust infrastructure and active development communities. Solana remains the only other blockchain with a significant share of USDT in circulation, attesting to its growing prominence.
The decision to decommission USDT on the five blockchains is not merely a technical adjustment; it’s a strategic recalibration that reflects broader market trends. The cryptocurrency ecosystem is increasingly gravitating towards solutions that promise efficiency and scalability. As Tether redirects its focus, it raises questions about the viability of smaller networks and their ability to compete in an ever-evolving space.
Looking forward, Tether’s move could signal a broader industry trend where stablecoin issuers prioritize platforms that support rapid development and user growth. The question remains whether other stablecoins will follow suit, potentially reshaping the competitive landscape of blockchain networks.
In the meantime, stakeholders and observers will be keenly watching how Tether navigates this transition and what it means for the future of stablecoins—and the crypto market at large. With September 1st looming, the clock is ticking for those still holding USDT on the soon-to-be-shelved chains. What lies ahead is a landscape that appears both promising and fraught with challenges, as Tether and its contemporaries forge paths into uncharted territories.
Source
This article is based on: Tether to Halt USDT on Omni, BCH, Kusama, EOS, Algorand as Focus Shifts to Layer 2s
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.
