Key Highlights
- Tether’s decision comes after an internal review that stated the token no longer justified continued operational support.
- Existing tokens will remain redeemable during a one-year grace period, after which redemption services will be discontinued.
- The company cited the shutdown due to low usage and limited long-term demand.
Tether, the issuer of the world’s largest stablecoin USD₮, announced plans to wind down support for its offshore yuan-pegged stablecoin CNH₮ on Friday. The decision comes after an internal review that concluded the token no longer justified continued operational support.
According to the official announcement, the company said it will immediately stop minting new CNH₮ tokens and will phase out redemption support over the next year.
Two-stage wind-down plan
Under the transition plan, Tether has halted the issuance of new CNH₮ tokens with immediate effect. Existing tokens will remain redeemable during a one-year grace period, after which redemption services will be discontinued.
The company said it will issue a reminder ahead of the final redemption deadline and encouraged holders to convert their CNH₮ balances before support ends.
Until the cutoff date, CNH₮ redemptions will continue under the standard terms of service.
Reason behind the decision
Tether cited the shutdown to low usage and limited long-term demand. According to the company, CNH₮ adoption levels did not justify the ongoing costs required to maintain the token at its operational standards.
The offshore yuan stablecoin was designed to track the value of the Chinese yuan traded outside mainland China. However, the product never reached the scale of Tether’s dollar-based offerings.
Growing initiatives
The move comes after Tether announced that Elemental Royalty Corporation will allow shareholders to receive dividends in Tether Gold (XAU₮). The initiative aims to connect traditional gold investment with blockchain infrastructure, building a link between shareholder returns and the underlying commodity.
Moreover, Rumble recently integrated Tether’s USA₮ into its non-custodial crypto wallet. The platform’s wallet already supports USD₮, Tether Gold (XAU₮), and Bitcoin.
Transition for token holders
Tether advised CNH₮ holders across supported blockchains to redeem their tokens before the deadline. After redemption support ends, users may no longer be able to convert CNH₮ directly through the issuer.
The company said the wind-down process will follow a structured approach similar to previous product retirements.
By discontinuing CNH₮, Tether is narrowing its focus to stablecoins with clearer demand, signaling a more selective approach to future token launches and maintenance.
Also Read: Tether Scales Back Fundraising Plan to $5B Amid Investors Hesitation
