Tether Operations Limited, the originator of Tether (USDT), the biggest stablecoin by market valuation, has introduced a stablecoin linked to the Mexican peso.
According to a May 26 release, the company’s new stablecoin will be called as “Tether tokens” and would be tied 1:1 to the Mexican peso. The stablecoin will be denoted by the sign “MXN.” According to the business, the new stablecoin will initially be available on three blockchains: Ethereum, Polygon, and Tron.
According to Tether, the decision was prompted by rising demand for stablecoin use in Mexico, where conventional financial transfer methods were causing issues for the majority of users. The World Bank listed Mexico as one of the top five nations in the world in terms of remittance receivers in US dollars last year. According to the country’s central bank, nationals residing abroad would send $51.6 billion home in 2021.
According to statistics from Triple-A, a cryptocurrency payments startup located in Mexico, 40% of Mexican enterprises are contemplating implementing blockchain and cryptocurrencies for their operations, with 71% of that group explicitly focused on employing cryptocurrencies. This need, according to Tether, offered an opportunity to launch a stablecoin that would place the Mexican peso on the blockchain and “enable quicker and less expensive choices for asset transactions.” Furthermore, the business added that their pioneering action will “pave the way for future fiat-pegged currencies to be introduced in the area.”
This need has piqued the interest of several major crypto businesses, like Coinbase, Bitso, and Circle, who have launched crypto services in the Latin American country.
Tether currently has four stablecoins on the market, in addition to three additional fiat-pegged tokens. These include the CNH linked to the Chinese Yuan, the EUR pegged to the Euro, and the USD fixed to the US dollar.
Tether’s action comes after two weeks of stablecoins decoupling from the US dollar as a result of UST’s decline. The USDT was not immune to the attack, falling as low as $0.95 in the second week of May. Tether, on the other hand, managed to allay depeg worries with a good reserves report.