Tether, the company behind the issuance of USDT tokens, has issued a total of 4 billion in a single day – more than the cryptocurrency’s current circulating supply – in what was seemingly a mistake.
The company’s move was first spotted by the Whale Alert Twitter bot, which tracks large transactions on the blockchains of top cryptocurrencies. The transaction that saw the company mint 5 billion USDT tokens caused a stir in the cryptocurrency community.
This, as there are currently over 3.9 billion USDT tokens, and an additional 5 billion being printed at once would get the token close to the $10 billion market cap. Moreover, some critics believe USDT tokens are used to manipulate cryptocurrency markets, and to pump the price of bitcoin.
Soon after Paolo Ardoino, the CTO of both Tether and Bitfinex, noted that the 5 billion USDT issuance was due to an “issue with the token decimals” that occurred while the company was preparing to swap tokens from the Omni layer to the TRON blockchain.
As covered, Tether and TRON announced a collaboration in March that would see the company issued TRON-based USDT tokens, compatible with the TRC-20 token standard.
While preparing the issuance for Omni to Tron swap there have been an issue with the token decimals. Please check the burn transactions below @Tether_tohttps://t.co/reEW51qCqihttps://t.co/zo5i3ayTuQ https://t.co/h1Y9Mnr4Oq— Paolo Ardoino (@paoloardoino) July 13, 2019
Paolo is correct - this occurred while Poloniex was conducting a USDT chain swap with the help of Tether. An incorrect amount of USDT was accidentally minted, and this has since been resolved to the intended value.— Poloniex Exchange (@Poloniex) July 14, 2019
As Ardoino revealed in his tweet, the mistake was fixed through transactions burning the excess tokens that were printed. In two transactions, Tether burned all of its 5 billion tokens, to then issue the 50 million USDT it intended to in the first place.
In one of the burning transactions, that saw Tether get rid of 4.5 billion USDT, users commented that the funds could have still been used for illicit purposes before they were burned. Currently, there are a total of 87.9 million USDT on the TRON blockchain.
Various cryptocurrency enthusiasts don’t trust Tether or cryptocurrency exchange Bitfinex – companies that share management – over allegations relating to market manipulation. Adding fuel to the fire, back in April the New York Attorney General accused the companies of covering up an $850 million hole.