Tether, which remains the issuer of the world’s largest stablecoin, USD₮ (USDT), has announced significant updates to its blockchain strategy, reflecting a seemingly forward-thinking approach to enhancing scalability, privacy, and user accessibility in the web3 and digital assets space.
On August 29, 2025, Tether revealed a revised plan for transitioning away from five legacy blockchains while simultaneously expanding its presence on Bitcoin’s innovative RGB protocol.
These moves underscore Tether’s commitment to aligning with high-demand ecosystems and reinforcing Bitcoin’s role as a key part of decentralized finance (DeFi).
In July 2024,Tether announced its intention to phase out support for USD₮ on five legacy blockchains: Omni Layer, Bitcoin Cash SLP, Kusama, EOS, and Algorand.
Initially, the plan involved ceasing redemptions and freezing tokens on these networks by September 1, 2025.
However, following feedback from user communities, Tether adjusted its approach. Instead of freezing tokens, the company will designate USD₮ on these blockchains as “unsupported.”
This means users can still transfer tokens between wallets, but Tether will no longer issue new tokens or facilitate redemptions on these networks.
This pragmatic compromise allows Tether to reduce operational overhead while avoiding the potential backlash of rendering user assets unusable.
The decision reflects a careful balance between streamlining infrastructure and maintaining user trust, ensuring a smoother transition for holders who may migrate their USD₮ to supported blockchains through third-party service providers.
Tether’s strategic pivot is driven by a comprehensive review of blockchain usage trends, developer activity, and market demand.
The legacy blockchains, while instrumental in Tether’s early growth, have seen declining transaction volumes over the past two years.
By redirecting resources to more robust and scalable networks, Tether aims to optimize its infrastructure for ecosystems with strong community engagement and technological advancements.
This aligns with the company’s broader vision of fostering a decentralized and sustainable financial future, prioritizing platforms that offer scalability and regulatory alignment.
Simultaneously, Tether is making bold strides to integrate USD₮ into Bitcoin’s ecosystem through the RGB protocol, a next-generation framework for issuing digital assets.
Announced on August 28, 2025, this initiative marks a significant milestone in expanding native stablecoin support on Bitcoin.
The RGB protocol, which reached mainnet with its 0.11.1 release, leverages client-side validation to enable private, scalable, and user-controlled transactions.
Unlike traditional blockchain protocols that burden the network with transaction data, RGB anchors ownership proofs to Bitcoin transactions while storing sensitive data off-chain on users’ devices.
This design minimizes network congestion, reduces fees, and enhances privacy, making it an ideal platform for USD₮.
The integration of USD₮ on RGB allows users to hold and transfer both Bitcoin and USD₮ within the same wallet, streamlining asset management.
Notably, RGB’s compatibility with Bitcoin’s Lightning Network enables near-instant, low-cost transactions, while its offline transaction capability enhances accessibility in regions with limited internet connectivity.
Tether’s CEO, Paolo Ardoino, emphasized that this move positions USD₮ as a “native, lightweight, private, and scalable” stablecoin on Bitcoin, reinforcing the cryptocurrency’s role as a decentralized foundation for global finance.
By enabling fast, private, and cost-effective payments, Tether aims to unlock new use cases for USD₮, including microtransactions, remittances, and DeFi applications.
This dual strategy—phasing out legacy blockchains and embracing RGB—highlights Tether’s adaptability in an evolving crypto landscape.
With a market cap exceeding $167 billion and a 68% share of the stablecoin market, Tether’s decisions carry significant weight.
The shift to RGB could accelerate Bitcoin’s adoption as a settlement layer for DeFi and institutional payments, while the transition from legacy chains ensures resources are focused on high-utility ecosystems like Ethereum, Tron, and now Bitcoin.
However, challenges such as regulatory scrutiny and RGB’s nascent adoption remain.
Nonetheless, Tether’s financial strength, evidenced by $4.9 billion in Q2 2025 profits, and its strategic investments in Bitcoin infrastructure position it to navigate these hurdles.
As Tether continues to focus on product development, its integration of USD₮ on RGB and the careful management of legacy blockchain transitions signal a transformative moment for stablecoins.
By leveraging Bitcoin’s security and scalability, Tether is hoping it can continue paving the way for a more accessible and efficient financial ecosystem.