According to Whale Alert, Tether released a fresh batch of USDT tokens worth $1 billion on the Ethereum blockchain on June 12, 2023. The transaction came less than two months after another large issuance on April 21.
Paolo Ardoino, who was Tether’s chief technology officer at the time, clarified that the transaction was part of the company’s inventory replenishment process. The tokens were classified as “authorized but not issued,” meaning they were held in Tether’s treasury rather than released into circulation.
That distinction is important because a large blockchain mint does not necessarily mean an immediate increase in USDT’s circulating supply or market capitalization.
PSA: 1B USDt inventory replenish on Ethereum Network. Note this is a authorized but not issued transaction, meaning that this amount will be used as inventory for next period issuance requests and chain swaps.https://t.co/Y1bqxZglgR
— Paolo Ardoino ???? (@paoloardoino) June 12, 2023
Why Tether mints USDT before issuing it
Tether’s inventory system allows the company to prepare USDT in advance for future customer demand and chain swaps. Tether currently explains that “authorized but not issued” tokens remain in its treasury and are not counted toward the market capitalization of the relevant Tether token.
Chain swaps are used when liquidity needs to be moved between supported blockchains. For example, an exchange may have excess USDT on Ethereum while facing higher withdrawal demand on Tron. Tether can facilitate a swap that moves the required liquidity between networks without necessarily creating additional circulating USDT.
This mechanism also gives Tether greater flexibility in responding to changing demand across blockchain ecosystems. Rather than waiting to create tokens every time liquidity is required, the company can maintain treasury inventory that is ready for future issuance.
The process has a security benefit as well. Tether says keeping authorized tokens in treasury inventory reduces how frequently its authorization keys need to be used, limiting their exposure to potential security threats.
Also Read: Iran Turns to USDT as Sanctions Push Businesses Toward Crypto Payments
USDT’s growth has far exceeded its 2023 scale
The original $1 billion transaction took place when USDT was already expanding rapidly. Tether had surpassed its previous market-capitalization record of $83.2 billion earlier in June 2023.
The scale of that growth has since changed substantially. Tether’s current website reports USDT market capitalization at about $183.8 billion, more than double the level recorded in the original article.
Tether has also continued to emphasize reserves and transparency as USDT circulation has expanded. Its current disclosures state that tokens in circulation are backed by reserves, while treasury inventory that has been authorized but not issued remains outside the circulating supply.
This makes the 2023 Ethereum mint better understood as a liquidity-management operation rather than a sudden $1 billion expansion of the stablecoin supply. The transaction showed how Tether prepares USDT for future demand across multiple blockchain networks.
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