Tether has introduced a groundbreaking digital asset called Alloy by Tether, which is backed by Tether Gold. Developed by Moon Gold NA, S.A. de C.V. and Moon Gold El Salvador, S.A. de C.V., this innovative product aims to combine the stability of a fixed unit of account with the security and reliability of gold.
Alloy by Tether marks the debut of a new category of digital assets known as tethered assets. These assets are designed to mirror the value of reference assets through advanced stabilization methods, such as over-collateralization with liquid assets and secondary market liquidity pools. This ensures a consistent value and stability between the reference asset and its digital equivalent.
The launch of the first token in the Alloy by Tether series, aUSD₮, is pegged to the value of one US dollar. What makes aUSD₮ unique is its over-collateralization by Tether Gold (XAU₮), meaning it is backed by physical gold stored in Switzerland. Users can generate aUSD₮ tokens by using Tether Gold (XAU₮) as collateral, providing a significant advantage for those interested in digital transactions and remittances without needing to sell their XAU₮ holdings.
Alloy by Tether utilizes smart contracts deployed on the Ethereum Mainnet. Users can create aUSD₮ by depositing Tether Gold (XAU₮) as collateral through a transparent process managed by Ethereum-compatible smart contracts. These contracts ensure transparency by monitoring all collateral and minted tokens, and using Price Oracles to consistently evaluate the Mint to Value (MTV) ratio.