Tether revealed it helped cryptocurrency exchange Binance with a "chain swap" in which 3 billion USDT/USD will be transferred from the Tron network to the Ethereum network.
"In a few minutes, Tether will coordinate with Binance to perform a chain swap, converting from Tron to Ethereum ERC20, for 3B USDT. The tether total supply will not change during this process," Tether stated.
In this case, a chain swap from the Tron network to the Ethereum network will be carried out by Tether
The Tether-issued USDT token is used to simplify trading operations on cryptocurrency exchanges like Binance. It is distributed on Ethereum ETH/USD, Tron TRX/USD, and other blockchain networks.
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Adjusting Reserves
The transaction is a part of Binance's attempts to shift USDT balances from its cold wallets on Tron to Ethereum, according to Tether CTO Paolo Ardoino.
Here, Binance will transfer 3 billion USDT to Tether's Tron treasury account from its Tron wallet.
A similar amount of USDT Binance ERC20 cold wallets on Ethereum are then sent back by Tether.
“Likely Binance has mostly USDT-on-Tron in its cold wallets and might want to rebalance its cold wallet, moving part of its Tether reserves to USDT-on-Ethereum,” Ardoino said.
Due to insufficient platform reserves, Binance temporarily halted processing withdrawals of another stablecoin, USDC, earlier today Binance CEO Changpeng Zhao revealed.
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