Tether Treasury is doing a rare USDT burn, which will see 64,6 million USDT redeemed and then quickly destroyed. We often hear about Tether Treasury printing a new USDT. However, it recently decided to withdraw a significant amount of its stablecoin in a surprising move.
Recently (within the past year) we inform As Binance went its own weekend, it saw a total of 2.2 million BNB worth over $ 38 million destroyed. Token burning refers to an intentional effort used by coin makers to reduce the circulating supply of coins. This is done by destroying or permanently removing a certain amount of the coin from the total amount that will ever exist. This mechanism is used mainly for deflationary purposes.
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64.6 million USDT exchanged and burned
64 USDT has been withdrawn from Bitfinex to be cashed in real dollars and then burned. Bitfinex CTO Paolo Ardoino has called it a redemption and says that «excess tokens will soon be destroyed».
The move was picked up by Whale Alert ( @whale_alert ) On Monday in the morning.
Swaps aren't new to Tether Treasury, but this is a relatively large amount to burn. It is unclear if Bitfinex is charging USDT or if it is a collective pool of user funds that have requested to be redeemed in USD.
Although the 64.6M USDT is a minor flaw compared to Tether's massive $ 4.6B market cap, most responses to the news have been bearish. Many see the USDT burnout 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 stir in the market.
Mere chance?
Coincidentally, Tether Treasury was not the only entity that burned its own stablecoin. Pax Treasury, for whatever reason, also decided to burn some of its own PAX tokens today. Whale Alert reports that about 1 PAX were burned.
USDT, PAX, and BNB burns are unlikely to be related, but the timing is curious, to say the least. January has been a busy month for stablecoins in general. As BeInCrypto previously reported, Bitcoin bulls got some momentum last week with a new minting of $ 20M USDC. The Coinbase-backed stablecoin is the second largest on the market.
