- Tether is winding down Alloy by Tether and aUSDT following a review of user activity and market demand.
- New position creation and aUSDT minting have been disabled immediately as the first phase of the shutdown.
- Users have until September 17, 2026 to redeem aUSD₮ and recover their XAUT collateral.
- Tether will prioritize XAUT and other core products with stronger liquidity and broader market demand.
Tether has announced the planned wind-down of Alloy by Tether and its overcollateralized digital asset aUSDT, marking a strategic shift toward products that have attracted stronger adoption across its ecosystem.
The company said the decision followed a review of user activity, market demand, and broader business priorities. As part of the transition, Alloy by Tether will no longer allow users to open new positions or mint additional aUSDT, effective immediately.
The move represents the latest adjustment to Tether’s product lineup as the stablecoin issuer continues to focus resources on offerings with deeper liquidity and larger long-term market opportunities, including Tether Gold (XAUT).
Tether Begins Phased Shutdown of Alloy by Tether
According to Tether, Alloy by Tether was launched as an experimental open platform designed to explore digital assets backed by Tether Gold. Its flagship product, aUSDT, allowed users to mint a dollar-referenced digital asset using XAUT as overcollateralized backing through Ethereum-compatible smart contracts.
The platform was introduced in June 2024 as part of Tether’s broader effort to explore tokenized real-world assets and gold-backed digital finance. Through Alloy, users could access dollar-denominated liquidity while maintaining exposure to tokenized gold.
Tether said the platform generated valuable insights into demand for gold-backed digital assets, collateralized products, and tokenized real-world assets. However, after evaluating adoption trends, the company decided to allocate resources toward products showing stronger user demand and broader market traction.
As the first stage of the shutdown, Alloy’s interface has been updated to prevent the creation of new positions and the minting of new aUSDT tokens. Existing users can continue managing and unwinding their positions during the transition period.
September 17 Deadline for Existing Users
Tether confirmed that current aUSDT holders will have a three-month window to return their tokens and reclaim the XAUT collateral backing their positions, subject to Alloy by Tether’s terms of use.
The deadline has been set for September 17, 2026. After that date, users who have not redeemed their aUSDT will no longer be able to recover their XAUT through the Alloy platform.
The phased approach is intended to provide an orderly exit process while preventing additional exposure from being created during the wind-down period.
XAUT Remains Central to Tether’s Gold Strategy
While Alloy and aUSDT are being discontinued, Tether emphasized that the decision does not represent a retreat from tokenized gold products. Instead, the company is placing greater emphasis on XAUT, its gold-backed digital asset.
Industry reports indicate that Alloy remained relatively small compared with Tether’s larger product ecosystem. The platform’s market capitalization was approximately $1.2 million, backed by around 14.73 kilograms of gold. By comparison, XAUT has grown into a significantly larger tokenized gold product with a market capitalization measured in billions of dollars.
The decision also follows a broader period of strategic realignment at Tether. In recent months, the company has expanded investments across tokenization infrastructure, artificial intelligence, robotics, and digital asset services while concentrating resources on products with stronger adoption and liquidity.
Meanwhile, Tether recently released Wallet 1.4, adding support for Bitcoin Lightning Network payments, including BOLT11 invoices and LNURL functionality. The update also improves transaction history visibility, fee transparency, and overall wallet performance through various bug fixes and enhancements.
Tether continues to expand in other areas. In May, the company announced plans to launch GELT, a stablecoin representing the Georgian lari, with support from the Georgian government.
Tether recently participated in a funding round of up to $1.4 billion for NEURA Robotics, underscoring its growing interest in artificial intelligence and robotics and signed a memorandum of understanding with DMCC to explore blockchain infrastructure and real-world asset tokenization initiatives in Dubai. The collaboration reflects Tether’s continued push into tokenization and digital asset innovation beyond its core stablecoin business.
With the Alloy shutdown now underway, Tether’s focus appears increasingly centered on XAUT, USDT, and other core ecosystem products that continue to attract larger user bases and market activity.
Market Performance of Tether Ecosystem Assets
At 10:31 a.m. UTC, aUSDT traded at $0.7003, with a market capitalization of approximately $35.01 million and a 24-hour trading volume of $45.86K. The token gained 2.06% over the past week while remaining unchanged over the last 24 hours, reflecting relatively limited market activity compared with Tether’s larger products.
Meanwhile, Tether Gold (XAUT) traded at $4,247.90, rising 4.11% over the past seven days despite a 1.35% decline in the last 24 hours. USDT remained stable at $0.9990, underscoring its role as Tether’s flagship stablecoin and highlighting the growing prominence of XAUT as the company phases out aUSDT and refocuses on core offerings.
