The implementation of the USDT representation mechanism contains several logical parts:
- The issuing and redemption process
- The peg maintenance and stabilization processes
THE ISSUING PROCESS
Tether Limited issues USDT on all supported blockchains using the token smart contracts an example of USDT contract on Ethereum. Such smart contracts contain issuance and redemption functions, all belonging to the contract ownership.
These functions are utilizable by Tether to mint USDT, burn USDT (from the owner’s address), blacklist addresses, remove them from the blacklist, and destroy USDT tokens possessed by the blacklisted addresses.
The list of networks where Tether Limited issues native USDT is available at this page.
THE PEG MAINTENANCE AND STABILIZATION
Tether Limited maintains the peg of USDT using its collateral reserves. Also, there is some additional information from the official source regarding addressing peg stability during the complicated market conditions.