- August 19, 2023
- Posted by: [email protected]
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Tether, the issuer of the USDT stablecoin, has decided to discontinue its Bitcoin Omni Layer version due to a lack of user interest. The Bitcoin version of Tether was one of the pioneering stablecoins, but the team has announced that it will no longer issue new Tether tokens on the Bitcoin Omni Layer, as well as on the Bitcoin Cash and Kusama platforms. The company’s announcement on August 17 revealed that redemptions will remain available for at least a year, with future updates to come on how redemptions will be handled after that period.
The Bitcoin Omni Layer, a smart contract system built on top of the Bitcoin blockchain, initially known as “Mastercoin,” was introduced in July 2013, preceding Ethereum by two years. In October 2014, Tether became the first stablecoin released on the Omni Layer system, quickly gaining popularity and emerging as one of the highest-market-cap stablecoins.
Tether’s announcement acknowledged the historical significance of the Omni Layer Tether and its vital role in the early days of the cryptocurrency ecosystem. However, the company cited challenges faced by the Omni Layer, including a lack of widely used tokens and the availability of USDT on other blockchains. As exchanges favored alternative transport layers, the utilization of USDT Omni declined, leading to the decision to cease issuance on this platform.
The team behind Tether indicated a willingness to reconsider reissuing the Omni Layer version if its usage rebounds. Additionally, Tether is developing a new Bitcoin smart contract system named “RGB.” Once RGB is completed, the company intends to reintroduce Tether in an RGB version, re-establishing its presence on the Bitcoin blockchain.
In the competitive landscape of stablecoins, Tether faces increasing challenges to its dominance in 2023. PayPal recently launched its PayPal USD (PYUSD) on August 7, and Binance introduced First Digital USD (FDUSD) on July 26, intensifying the race among stablecoins for market share.
