Tether has unveiled Alloy by Tether, a pioneering digital asset backed by Tether Gold. This innovative product, developed by Moon Gold NA, S.A. de C.V. and Moon Gold El Salvador, S.A. de C.V., aims to merge the stability of a fixed unit of account with the reliability and security of gold.
Alloy by Tether represents a new class of digital assets known as tethered assets. These are designed to track the value of reference assets through advanced stabilization mechanisms, including over-collateralization with liquid assets and secondary market liquidity pools. This ensures consistent value and stability between the reference asset and its digital counterpart.
Launch of aUSDâ‚®
The first token in the Alloy by Tether series is aUSDâ‚®, a digital currency pegged to the value of one US dollar. What sets aUSDâ‚® apart is its over-collateralization by Tether Gold (XAUâ‚®), meaning it is supported by physical gold stored in Switzerland. Users can mint aUSDâ‚® tokens by using Tether Gold (XAUâ‚®) as collateral. This offers a significant advantage for those looking to engage in digital transactions and remittances without having to liquidate their XAUâ‚® holdings.
Alloy by Tether utilizes smart contracts deployed on the Ethereum Mainnet. Users can mint aUSDâ‚® by depositing Tether Gold (XAUâ‚®) as collateral through a transparent process managed by Ethereum-compatible smart contracts. These contracts maintain transparency by tracking all collateral and minted tokens and using Price Oracles to continually assess the Mint to Value (MTV) ratio.
