Outrageous! Tether Mints $1B USDT With 53 Cents in Fee

Leading stablecoin issuer Tether minted one billion units of its flagship product, USDT, on the Ethereum network earlier today. Surprisingly, the issuing company completed the transaction with only 53 cents, a significantly low gas fee for such a huge amount. Here’s what might have caused it.

TETHER MINTS $1 BILLION USDT

Guess how much they paid?

… 53 cents. https://t.co/QqXXg7x96g pic.twitter.com/AJoaFaOUkc

— Arkham (@ArkhamIntel) August 13, 2024

What Triggered the Low Fee?

Ethereum gas fees are transaction fees paid to network validators for processing transactions. Factors determining how much users spend on these fees include transaction urgency, network congestion, and the weight of user’s activities.

Although there is no specific reason for such an outrageously cheap transaction, several factors may have triggered it. One is that the Ethereum mainnet may have been less congested when Tether executed the trade, hence a low demand for blockspace. Another possibility is that Tether did not carry out its mint as a priority transaction, increasing the completion time of the transaction.

Regardless of the driving force behind the cheap gas fee, Tether’s transaction gives evidence of the blockchain’s capability. Unlike traditional banks and remittance services, blockchain technology enables anyone to send large amounts at minimal cost. 

Tether Commits to Frequent Mints

Tether’s $1 billion mint is not a surprising move. The stablecoin issuing company is known for periodically minting USDT to bolster the asset’s value. These mints aim to regulate the stablecoin’s supply and support its peg to the United States dollar.

Occasionally, Tether mints USDT stablecoins and moves the stash to several exchanges. Such a move is widely recognized as a nod towards an incoming buying pressure to bolster the global crypto market. Last week, the stablecoin issuer made one such action.

Shedding light on the latest mint, Tether’s CEO Paolo Ardoino tweeted:

PSA: 1B USDt inventory replenish on Ethereum Network. Note this is an authorized but not issued transaction, meaning that this amount will be used as inventory for next period issuance requests and chain swaps.

— Paolo Ardoino 🤖🍐 (@paoloardoino) August 13, 2024