Tether is once again the subject of controversy following an official tweet by Whale Alert on July 13. The Twitter account is one of the high-regarded outlets in the industry when it comes to large crypto-related transactions. According to the tweet, Tether Treasury accidentally printed and issued 5 billion worth of USDT to its users. Upon realizing the significant mistake, Tether subsequently burned the tokens. However, despite immediate realization, the crypto community had already noticed the fault.
Whale Alert tweeted that the Tether Treasury received $50 million worth USDT tokens from Poloniex, a major cryptocurrency exchange. The transfer was conducted using Bitcoin’s Blockchain, particularly with the support of the Omni protocol. Subsequently, Tether Treasury printed $5 billion worth USDT tokens using the Tron Blockchain. Afterward, Tether used the same Blockchain to burn them.
Paolo Ardoino, the CTO of Tether, immediately spoke up about the issue. There had been a wave of reactions from the crypto community, and the popular stable coin was aware that many people are waiting for their explanation. He confirmed that Poloniex sought the assistance of Tether in performing a USDT chain swap. However, during the process, Tether made a mistake with the decimals. Instead of minting 5 million, they ended up printing 5 billion.
As a result, Tether had to print 50 million worth of USDT once again on the same chain and dealt with the remaining 4.5 billion USDT by burning them. Afterward, Tether transferred $50 million USDT tokens to a digital wallet which is likely owned by Poloniex. In return, the crypto exchange confirmed that the issue had been resolved immediately and efficiently.
Before this controversial mistake, Tether lost another client from New York. Metropolitan Commercial Bank reportedly shut down their accounts that are associated with the stablecoin. The move, however, had been anticipated since the request had been made last year.