Tether recently announced the launch of a new platform called Alloy, which introduces aUSD₮, a digital asset backed by Tether Gold (XAU₮). This new asset aims to combine the stability of the US dollar with the enduring value of gold. The aUSD₮ token is designed to maintain the value of one US dollar, while being backed by physical gold stored in Switzerland.
What sets aUSD₮ apart is that it is over-collateralized by Tether Gold, meaning that the value of the gold held as collateral is higher than the value of the aUSD₮ tokens issued. This strategy provides a safety net against potential fluctuations in the value of the collateral asset, ensuring stability and reliability for users. The minting and management of aUSD₮ are facilitated through Ethereum-compatible smart contracts, ensuring transparency and security by tracking all collateral and minted tokens using price oracles.
The goal of aUSD₮ is to offer the functional advantages of using the US dollar, such as widespread acceptance in payments, trading, settlements, and savings, while incorporating the intrinsic benefits of gold, such as scarcity, low volatility, and preservation of purchasing power. Alloy by Tether is an open platform that will allow the creation of various Tethered Assets with different backing mechanisms, potentially including yield-bearing products. This flexibility enables the platform to cater to various customer segments and regulatory requirements.
Tether CEO Paolo Ardoino stated, “Alloy by Tether is an open platform that allows users to create collateralized synthetic digital assets and will soon be part of the new Tether digital assets tokenization platform, launching later this year.” Alloy represents a significant advancement in the digital asset landscape, enabling users to mint stablecoins directly through the platform. By combining the stability of the US dollar with the security of gold, Tether aims to offer a dependable and versatile digital currency for everyday use and asset management.
This new class of tethered assets aims to redefine stability in the digital economy, providing users with a modern approach to managing and transacting with digital assets. With Alloy, Tether is paving the way for a new era of digital asset management and transaction.