Tether Ends Omni Support, Impacting Bitcoin Layer Usage

Tether, a prominent stablecoin issuer, has announced the discontinuation of support for Omni, a Bitcoin layer utilized for USDT transfers since 2014. The decision also extends to Kusama (KSM) and Bitcoin Cash (BCH) Simple Ledger Protocol (SLP) implementations. Omni serves as a software layer built atop the Bitcoin blockchain, aimed at enhancing the blockchain's capabilities through the provision of smart contract functionalities. However, Tether highlighted the challenges Omni Layer faced over the years, primarily stemming from the lack of widely-used tokens and the availability of USDT on other blockchains. Consequently, several exchanges preferred alternative transport layers, leading to a decline in USDT usage on Bitcoin through the Omni Layer. Tether, boasting the position of the largest stablecoin with an $82 billion market capitalization, has issued $240 million worth of tokens on the Omni layer. Additionally, $1.4 million and $980,000 worth of tokens are issued on Kusama and Bitcoin Cash respectively, as reported by Tether's transparency report. The stablecoin issuer has revealed its plan to cease USDT issuance on Omni, Kusama, and Bitcoin Cash starting August 17. However, redemptions will remain operational for the subsequent 12 months. The recent development has had a minor impact on the price of Tether, which experienced a slight 0.12% decline over the past 24 hours, currently trading at $0.998 according to CoinDesk data. The decision to halt support for Omni, Kusama, and Bitcoin Cash marks a significant shift in Tether's strategy and reflects the evolving dynamics within the cryptocurrency landscape. As Tether moves forward with its realignment, market participants and observers will closely monitor the consequences of this decision on the affected blockchain layers and the broader stablecoin ecosystem.