Tether has surprised the crypto enthusiasts by announcing that its latest digital stablecoin offering, which is branded as “Tether Gold” (XAUT), will be backed by gold stored in a secret Swiss vault. The new digital product designed by the stablecoin masters will be tradable on the Ethereum and Tron blockchains.
According to the press release made by the Tether team, the new stablecoin XAUT will represent one troy ounce within the gold bars which are securely placed in the platform’s private vaults. The TRC-20 and ERC-20 tokens backed by gold will allow the investors to enjoy high standards of liquidity and exchange. The official statement affirmed that the growing popularity of gold in the global financial marketspace had been the prime triggering reason for the Tether community to launch a stablecoin supported by gold.
Interestingly, the statement released to the news outlet didn’t disclose any information about the location, name, or any crucial specifications about the Swiss vault where the security gold bars are stored. Tether lured the potential investors by assuring them that they would enjoy a ‘direct control’ over the gold bars pegging security against the stablecoin. The investors will not be entitled to pay any amount as storage fees.
CTO of Tether, Paolo Ardoino, commented that
the new asset provides both stability of gold and the speed of virtual assets. The asset will serve as the gold substitute for those who want to buy and store gold. Sometimes, people cannot afford to build a special vault or use a bank vault, so the offer is clear.
Tether has been in the limelight for all the bad reasons in recent times. The NYOAG has found several proofs of Tether’s involvement in scams such as the QuadrigaCX scam, Crypto Capital kitchen scan, etc. A majority of traders accept that the stablecoin industry has suffered significantly because of Tether’s poor economic decisions. The currencies added to the exchanges by Tether and its affiliates have restrained the growth and success of the stablecoin sector.
Also, with Tether not unveiling any details about the vault storing the security gold bars, there are chances of people not trusting the new stablecoin project claims of the firm. Only time will tell if Tether’s new stablecoin project is backed by gold in the real sense or not!