Tether Just Pulled the Plug on Gold-Backed aUSDT

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Blockchain platform Tether is shutting down Alloy by Tether and its flagship aUSDT stablecoin after concluding that the platform no longer aligns with its long-term priorities. The company said the decision followed a review of user activity, liquidity, and market demand, and that future investment is shifting toward products such as Tether Gold (XAU₮) and the wider Tether ecosystem. Existing users will have three months to close their positions before the platform fully ceases support.

Tether Begins Alloy Wind-Down

Indeed, Tether announced on June 17 that Alloy by Tether will immediately stop allowing users to open new positions or mint additional aUSD₮ tokens.

The company said Alloy was originally launched as an experimental platform for creating digital assets backed by Tether Gold (XAU₮), with aUSD₮ serving as an overcollateralized dollar-pegged asset backed by tokenized gold.

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According to Tether, the platform generated valuable insights into demand for gold-backed digital assets and tokenized real-world assets (RWAs). However, the company ultimately decided to redirect resources toward areas with stronger user demand, deeper liquidity, and greater long-term growth potential.

Current users can continue redeeming aUSD₮ and withdrawing their XAU₮ collateral during a three-month transition period. Beginning September 17, 2026, customers who haven’t redeemed their aUSD₮ will no longer be able to recover the underlying gold collateral through the Alloy platform.

Focus Shifts to Core Products

The decision continues Tether’s wider strategy of streamlining its product lineup around its largest and fastest-growing offerings.

Launched in 2024, the aim of Alloy by Tether was to explore tokenized assets backed by gold, and aUSD₮ maintained its dollar peg by requiring more XAU₮ collateral than the value of stablecoins issued.

According to the Alloy platform, aUSD₮ currently has a market capitalization of approximately $1.27 million, backed by about 14.73 kilograms of gold valued at around $2.2 million.

The move follows Tether’s earlier retirement of its euro-linked digital currency EUR₮ and comes as the company continues growing other initiatives, which include Tether Gold and new government-backed stablecoin projects. By winding down Alloy, Tether appears to be concentrating its development efforts on products it believes have more extensive adoption prospects and stronger institutional demand.