Key Points
- Willy Woo believes Tether’s gold-backed stablecoin Alloy (aUSDT) is a “genius business idea.”
- Tether’s new synthetic dollar is the first step in the rollout of a real-world asset tokenization platform.
Tether has just introduced a gold-backed stablecoin pegged to the US dollar. This is the first tethered asset and the new coin is called Alloy (aUSDT).
The stablecoin is mintable on the new Alloy platform by Tether. Alloy will be overcollateralized by Tether Gold (XAUt) which is a token that provides ownership of physical gold, but pegged to the US dollar.
This new token is a synthetic dollar, designed to mimic the value and functionality of the US dollar without being directly backed by it.
Willy Woo calls the initiative “a genius business idea”
Today, in a new post on X, Bitcoin on-chain analyst Willy Woo called the latest initiative by Tether, a genius business idea.
He said that instead of issuing USDT and earning the T-Bills yield, the company can now issue aUSDT earning the gain on gold. Woo believes that over the long term, gold gets 8%, compared to T-Bills at 0-5%.
He continued and said that given Tether is building a sizeable BTC treasury, he would not be surprised in a future where they would also issue bUSDT backed by Bitcoin.
Woo highlighted that even if this does not make too much sense right now, with the massive market volatility, in a future cycle where Bitcoin is bigger and less volatile, such a thing could happen.
He also wondered whether this new stablecoin pulls a Do Kwon and goes the way of Terra/Luna due to having a stablecoin backed by a volatile asset.
Alloy explains tethered assets
In a post on X, Alloy explained that tethered assets are digital assets that aim to track the reference price of another asset via various stabilization mechanisms.
They also said that Alloy offers long-term holders the opportunity to maintain exposure to gold while obtaining a dollar-referenced Tethered Asset for payments and daily economy.
aUSDT was developed by Tether subsidiaries Moon Gold and Moon Gold El Salvador.
