Tether is winding down the Alloy project: aUSDT becomes history
The stablecoin market continues to consolidate. On June 17, Tether officially announced the phased closure of the Alloy by Tether platform and its key asset — aUSDT. This dollar-denominated token, backed by Tether Gold (XAUt), did not meet the company's expectations.
The first phase has already taken effect: after the interface update, users lost the ability to open new positions and issue fresh aUSDT. This is a standard procedure for products that have not found mass demand.
Existing clients are given a three-month period — until September 17 — to redeem aUSDT and withdraw their collateral XAUt. If this is not done, the ability to retrieve the collateral directly through the platform will be lost. The amount of locked funds is small, but the procedure requires attention.
Alloy by Tether was launched exactly one year ago — on June 17, 2024. The idea was to create an overcollateralized dollar asset: the value of the locked gold was supposed to exceed the volume of issued aUSDT. This allowed XAUt holders to obtain dollar liquidity without needing to sell tokenized gold, which is particularly relevant for long-term investors.
However, as Tether explained, a review of user activity and market demand revealed low demand for the product. The company decided to focus resources on the flagship XAUt and other key elements of the ecosystem.
The numbers speak for themselves: the market capitalization of Alloy by Tether was about $1.2 million, with gold reserves of 14.73 kg (approximately $2.2 million). In comparison, the market value of XAUt exceeds $3 billion, with backing of 22,169 kg of precious metal. The difference is enormous.
Company representatives note that Alloy helped test demand for gold digital assets and collateral instruments, as well as study user behavior in the field of tokenization and RWA. This is valuable experience, but commercially the product did not succeed.
This is not the first time Tether has trimmed its product line. In February, the company discontinued support for the CNHT stablecoin based on the Chinese yuan, citing low interest and changing market conditions. And in November 2025, EURT was wound down due to regulatory restrictions in Europe and a focus on the Hadron tokenization platform.
Against the backdrop of these decisions, let me remind you: at the end of the first quarter of 2026, Tether's net profit amounted to $1.04 billion. The company feels confident but clearly separates promising projects from those that do not deliver results.
My analysis: The closure of Alloy is a logical step in an environment where the stablecoin and tokenized asset market is becoming increasingly competitive. Tether demonstrates a pragmatic approach: if a product does not show mass adoption, it is phased out in favor of stronger positions. For investors, this is a signal: XAUt remains a priority, while niche solutions without demand are a temporary luxury.