According to reports from CoinDesk and BeInCrypto, Tether will shut down its gold-backed lending platform Alloy on September 17, 2026. The platform launched on June 17, 2024, and CEO Paolo Ardoino positioned it as a new breed of gold-backed digital money. Users deposited XAUT tokens, which are backed by one troy ounce of Swiss-vaulted gold, and borrowed aUSDT, a dollar-tracking token. Since the wind-down announcement, borrowers have repaid more than half of their positions, with only five open positions remaining as of August 10. New minting has stopped immediately, marking the end of the platform's operations.
As reported by CoinDesk and BeInCrypto, the five remaining borrowers owe 399,088.74 aUSDT against 194.41 Tether Gold (XAUT) in collateral. The total collateral value is approximately $850,000 at XAUT's current price of $4,372. However, the platform's performance has been minimal, with its June 30 attestation valuing all collateral at just $1.9 million. This represents a significant fraction of Tether's $183 billion stablecoin business, making Alloy essentially a rounding error for the company. The platform's two-year lifespan from launch to closure demonstrates its limited market adoption despite the gold-backed concept.
According to CoinDesk and BeInCrypto reports, regular Tether Gold holders can relax as the XAUT token itself is not closing. The 194 locked ounces represent only 0.03% of the token's 707,747-token supply. However, two cautions remain for investors. Exiting the platform costs a 0.25% fee, and Tether has published no recovery path for anyone who misses the September 17 deadline. Additionally, buying aUSDT on the open market grants no claim on anyone's locked gold. The $2.7 billion XAUT market cap demonstrates the token's broader market value, while the locked collateral represents a minimal fraction of the total supply.
As reported by CoinDesk and BeInCrypto, demand for Tether Gold itself appears healthy, with Tether Gold whale flows picking up in recent weeks. The real question centers on the smaller issue of whether the five remaining borrowers will settle their positions within the 37-day window remaining. The platform's closure represents the end of a gold-backed lending experiment that never gained significant traction in the market, with the $850,000 collateral representing a fraction of the total XAUT supply. The closure highlights the challenge of converting gold-backed concepts into viable financial products in the digital asset space.
