Dear friends in the crypto circle, today we are going to talk about the significant event of Tether issuing 1 billion USDT on the TRX chain. There are many intricacies behind this, which may significantly impact your upcoming investment decisions!
Looking at the short term, this issuance is like directly injecting money into the market. Historically, every time USDT is issued, it brings a wave of liquidity that stimulates cryptocurrency prices to rise. For example, during the issuance in 2019, Bitcoin's price surged accordingly. This time, with an additional 1 billion USDT suddenly on the TRX chain, it has directly expanded the trading pool of the TRX chain, especially in popular areas like DeFi and NFTs within the Tron ecosystem, where trading activity is bound to soar. It's worth noting that the average daily trading volume of USDT on the TRX chain has already reached 25 billion dollars, and after this issuance, this number is likely to hit a new high.
Speaking of this, we have to mention the TRX price. It is closely tied to the circulation of USDT. In April 2025, when the circulation of USDT on the TRX chain broke 70 billion dollars, the TRX price surged. Although the TRX price briefly dropped by 2.08% after the issuance increase on May 15, in the long run, with the continuous issuance of USDT, increased use of the Tron network, and a more active ecosystem, the TRX price may still have significant movements. Moreover, the newly issued USDT may also cross-chain into Ethereum and other public chains, indirectly affecting the prices of mainstream coins like Bitcoin and Ethereum.
From a long-term perspective, this issuance is a key step for Tether's bet on the Tron ecosystem. Now the circulation of TRC20-USDT has reached 75.7 billion, and its market share has surpassed ERC20-USDT for the first time. With this issuance of 1 billion USDT, the status of the TRX chain as the main circulation platform for USDT is even more solid, attracting more exchanges, DeFi protocols, and users. For instance, top exchanges like Binance and OKX have long regarded TRC20-USDT as a primary trading pair.
For the Tron DeFi ecosystem, this is also a significant positive. In April 2025, the trading volume of Tron DeFi increased by 40% compared to the previous month, with TVL exceeding 5.5 billion dollars. The newly added USDT will provide more liquidity to lending protocols and decentralized exchanges, resulting in lower trading slippage and a better experience. Additionally, USDT is already widely used in cross-border payments, and with low transaction fees and fast settlements on the TRX chain, its applications in this area will certainly be more widespread in the future.
However, we must also be vigilant about risks. The issuance of USDT has been questioned regarding the transparency of its reserves. Although Tether has disclosed holding nearly 120 billion dollars in U.S. Treasury bonds and other assets, it has faced several issues in the past regarding reserve transparency. After this issuance, the reserve situation will certainly be scrutinized again. Furthermore, regulatory scrutiny is increasing in Europe and the U.S., with the EU requiring stablecoin issuers to operate with licenses and the U.S. advancing new legislation. While Tether shifting focus to the TRX chain might evade some regulations, conflicts with European and American regulations may intensify. If abnormal price fluctuations occur after the issuance, there may also be suspicions of market manipulation.
Finally, let's discuss the impact on us investors. This issuance may bring a wave of benefits to Tron DeFi projects, and those looking to capitalize on opportunities can pay attention to liquidity mining and lending yields, but be cautious of smart contract risks. Regulatory policies change quickly, so our holdings shouldn't be too concentrated; diversifying risks is crucial. Additionally, TRX and USDT are strongly correlated, so closely monitoring on-chain data for TRC20-USDT may help anticipate TRX trends. Continuous attention to Tether's reserve situation is also necessary; fluctuations in Treasury bonds, Bitcoin, and gold reserves will all impact the stability of USDT.
In summary, Tether's issuance of 1 billion USDT on the TRX chain can stimulate the market in the short term and reshape the stablecoin landscape in the long term, but the risks cannot be ignored. Everyone should invest cautiously, conduct thorough research and analysis, and while seizing opportunities, protect their assets!