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Stablecoin leader Tether announced on Thursday that it has ceased USDT support for three blockchains where the token “lacks significant traction.”
The affected chains are Bitcoin’s Omni Layer, Bitcoin Cash’s Simple Ledger Protocol (SLP), and Kusama.
No Signs Of Omni Adoption
As detailed on Tether’s website on Thursday, community engagement is a “key factor” in determining whether the company will introduce USDT to a specific network.
“If a blockchain lacks significant traction over an extended period and shows no signs of recovery in usage indicators, maintaining support becomes inefficient and may jeopardize security and oversight,” stated Tether.
Unfortunately for the firm, this seems to be the situation with Omni – a smart contract layer established on Bitcoin to facilitate smart contracts and tokenization on the network nearly a decade ago. In 2014, Omni became the “first transport layer” for Tether, playing a “crucial role” in the company’s early development.
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“Over the years, the Omni Layer encountered difficulties due to the absence of popular tokens and the availability of USD₮ on other blockchains,” Tether noted. Cryptocurrency exchanges, for instance, have preferred other layers like Ethereum and Tron, resulting in diminished USDT transfers on Omni.
Tether indicated it would reassess the possibility of launching USDT on Omni if there were “increased utilization” of its decentralized exchange and token issuance protocol in the future.
Bitcoin’s Future With Stablecoins
Nonetheless, Tether remains committed to Bitcoin: it now intends to issue USDT on RGB, an alternative smart contracts system that utilizes Bitcoin’s base layer and lightning network for “unparalleled scalability.”
“We firmly believe that RGB will usher in a new era for digital assets, smart contracts, and digital rights, garnering comprehensive support from major players in our industry,” stated Tether.
While USDT mints conclude as of today, holders of USDT on these chains will still have the opportunity to redeem their tokens for the next 12 months. They may also trade their tokens on exchanges, such as Bitfinex, for assets on other chains.
Although Omni has struggled to achieve adoption, several other initiatives for Bitcoin-based stablecoins have emerged in recent years. In May, Stably introduced the first stablecoin on Bitcoin’s base layer utilizing the BRC-20 token standard, which was developed using Ordinals technology.
The creator of BRC-20 has himself advocated for Taro – a developing protocol for issuing assets on Bitcoin’s lightning network.
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