aUSDT: An artificial dollar backed by Tether explained.

TLDR

Tether has launched a new tokenization platform on the Ethereum network called Alloy, which allows users to create tokens backed by Tether Token Gold (XAUT). The first token on the Alloy platform is aUSDT, a synthetic dollar designed to track the value of the dollar while being leveraged by XAUT. Users can generate aUSDT tokens by depositing XAUT as collateral, which is managed by smart contracts and price oracles to ensure transparency and stability. Alloy by Tether is an open platform that can deliver future products and will be part of Tether's upcoming digital asset token platform. The launch of Alloy and aUSDT is part of Tether's efforts to expand its service beyond issuing USDT and plans to facilitate a variety of assets, including bonds, stocks, and loyalty reward points.

Tether, the company behind the world's largest stablecoin, USDT, has announced the launch of a new token creation platform called Alloy on the Ethereum network.

This platform introduces a new category of digital assets known as “combined assets” designed to track the value of reference assets through stabilization mechanisms such as liquid asset overdrafts and secondary market liquidity pools.

The first token on the Alloy platform is aUSDT, a synthetic dollar that aims to combine the stability of the US dollar with the safety and reliability of gold.

Unlike traditional stablecoins, aUSDT is held in excess of Tether's tokenized gold (XAUT), which is backed by physical gold stored in Switzerland.

This unique approach allows users to engage in digital transactions and payments while maintaining exposure to gold without having to sell their XAUT holdings.

To generate aUSDT tokens, users can deposit XAUT as collateral through Ethereum-compatible smart contracts. The aUSDT smart contract ensures transparency by tracking all collateral and pooled tokens, while price oracles regularly review the Mint to Value (MTV) ratio to enhance stability.

The implementation process is designed to be scalable and the maximum amount of the new tokens is limited to 75% of the collateral value.

Paolo Arduino, CEO of Tether, stated that the launch of Alloy on Tether will introduce a new class of digital assets backed by gold and linked to fiat currency. Tether also stated that it plans to offer this technology on its digital asset token platform, which will launch next year.

aUSDT, the first captive asset, just launched! aUSDT is a synthetic dollar backed by XAUt (Tether Gold).

Alloy by Tether is an open platform for creating collateralized synthetic digital assets and will soon be part of the new @Tether_to digital assets.

– Paolo Arduino ?????? (@paoloardoino) June 17, 2024

The Alloy platform is an open platform for creating a variety of associated assets with a wide range of support mechanics, which can include production products.

This technology provides a modern approach to asset management for institutions, providing secure, gold-backed digital assets that can be integrated into portfolios.

Moon Gold NA, SA de CV, and Moon Gold El Salvador, SA de CV, both authorized by CNAD, the digital asset regulatory body in El Salvador, oversee the distribution and management of Alloy by Tether, meeting the various client segments and regulatory requirements. .

The launch of Alloy and aUSDT is part of Tether's efforts to expand its services beyond issuing USDT.

The company has recently invested in various areas including Bitcoin mining, payment processing and artificial intelligence in cloud computing.

Arduino has outlined plans to launch a tokenization platform that will help create digital versions of various assets such as bonds, stocks, funds and loyalty reward points.