Tether scraps USDT Multi-Chain expansion, shifts focus to core growth

Tether has scrapped its Tether USDT five chains plan, reversing earlier intentions to freeze smart contracts across five blockchains. Instead, tokens on Omni Layer, Bitcoin Cash SLP, Kusama, EOS, and Algorand will remain transferable—though issuance and redemption on these networks have officially ceased.

“Tether has revised this approach and will not freeze the smart contracts on these networks,” the company said in a statement. “Users will continue to move their tokens, but official support for issuance and redemption has been withdrawn.”

The reversal follows consultations with ecosystem participants, underscoring how Tether balances operational strategy with market feedback.

A limited impact on total circulation

While the Tether usdt five chains plan affects several blockchains, its overall impact on USDT’s $167.4 billion market share is minor. Data from DeFiLlama shows that Omni Layer, once central to Tether’s early growth, holds just $82.9 million in circulating USDT. EOS carries $4.2 million, while Algorand, Kusama, and Bitcoin Cash SLP each hold less than $1 million.

Tether had already begun winding down support for these networks. New issuance was halted on Omni, Kusama, and Bitcoin Cash SLP in August 2023, with EOS and Algorand following in June 2024.

“Subsidizing underutilized chains diverts resources from the ecosystems where USDT truly thrives,” — Paolo Ardoino, CEO, Tether, in a recent statement.

Instead, Tether continues to consolidate around Ethereum and Tron, which now dominate its circulation with $72.4 billion and $80.9 billion worth of USDT, respectively. BNB Chain follows at $6.78 billion, while newer platforms such as Arbitrum, Base, and Solana are emerging competitors, particularly in relation to Circle’s USDC.

Why Tether is narrowing its focus

The decision to scale back the Tether usdt five chains plan reflects a broader strategy: concentrating resources where liquidity, demand, and developer activity are highest. Stablecoin adoption has become a linchpin in crypto infrastructure, particularly in trading, remittances, and DeFi protocols.

Industry experts like Clara Medalie, Research Director, Kaiko argue that Tether’s move is pragmatic. “Maintaining multiple low-volume networks is inefficient. The real growth lies in ecosystems with deep liquidity pools and developer innovation,” — She said.

The pivot comes amid rapid global expansion of the stablecoin sector, currently valued at $285.9 billion. Both Tether (USDT) and Circle’s USDC dominate, with market caps of $167.4 billion and $71.5 billion, respectively, according to CoinGecko.

Regulatory shifts and market outlook

The Tether usdt five chains plan shift coincides with a stronger policy focus on dollar-pegged stablecoins. The U.S. government’s recently enacted GENIUS Act, signed by President Trump, aims to reinforce dollar-backed digital assets as tools of financial competitiveness.

The Treasury Department projects the global stablecoin market could surpass $2 trillion by 2028. Such forecasts highlight the importance of interoperability, compliance, and liquidity management—areas where Tether appears to be recalibrating its efforts.

Ripple CEO Brad Garlinghouse recently echoed this outlook, stating, “Many people think it will reach $1 to $2 trillion in a handful of years. Ripple is positioned to benefit from that trajectory.”

Meanwhile, firms like Western Union are exploring stablecoin integrations for cross-border payments, betting on their ability to streamline global remittances and improve financial access in developing markets.

What this means for investors

For crypto investors, the end of the Tether usdt five chains plan signals two clear trends: first, a narrowing of Tether’s operational scope to its most liquid networks; and second, alignment with broader regulatory and market shifts that favor efficiency over fragmentation.

As Ethereum, Tron, and BNB Chain capture the lion’s share of stablecoin activity, investors can expect liquidity to remain concentrated on these platforms. At the same time, the sector’s projected growth to trillions underscores the long-term significance of stablecoins in both decentralized finance and traditional payments.