FAQs
Frequently Asked Questions
What is a Tethered Asset?
Tethered Assets are tokens designed to track the price of a specific reference asset, such as the US Dollar, thanks to the use of overcollateralization and secondary market liquidity pools.
Tethered Assets can accept single or multiple types of collateral and can track the price of most known assets, such as fiat currencies, commodities, and other similar products.
What is Alloy by Tether?
Alloy by Tether tokens are Tethered Assets that use Tether Gold as collateral and are intended to track the price of fiat currencies. aUSD₮ is the first Alloy by Tether token and is intended to track the U.S. dollar. By using Tether Gold as collateral, Alloy by Tether positions itself as a digital asset that is stabilized by gold: the original scarce, low volatility way to preserve value.
aUSD₮ is minted through the use of smart contracts which are designed to be Ethereum Virtual Machine (EVM) compatible.
What is a Smart Contract?
Smart contracts are software programs deployed on a blockchain, designed to execute automatically when predefined conditions are fulfilled.
Their primary function is to enhance transparency and auditability in agreements and workflows.
By leveraging blockchain technology, smart contracts ensure that all involved parties can instantly verify outcomes without the need for intermediaries, promoting a transparent and easily auditable process.
In the case of aUSD₮, smart contracts allow for independent and permissionless verification of the XAU₮ collateral backing each aUSD₮ issued.
What is Tether Gold?
Tether Gold is a centralized stablecoin, denominated in fine troy ounces of gold, that represents the ownership of physical gold. Each unit of Tether Gold represents ownership of one fine troy ounce of physical gold stored in a Swiss vault on behalf of the Tether Gold token holders. This provides a way for cryptocurrency users to gain an ownership interest in and exposure to the value of gold without physically storing the precious metal.
How can I acquire aUSD₮?
aUSD₮ can be acquired by depositing XAU₮ to the aUSD₮ smart contract and minting aUSD₮ directly from the aUSD₮ smart contract. Alternatively, aUSD₮ can be traded on the secondary market through Centralised Exchanges (such as Bitfinex) or Decentralised Exchanges.
How can I get back the XAU₮ Deposited as collateral?
In order to get back the XAU₮ users deposit as collateral, users have to request a withdrawal from the Alloy by Tether Vault smart contract. The Alloy by Tether Vault smart contract will not allow you to withdraw your XAU₮ if it would mean your Mint to Value (MTV) exceeds the Liquidation Point (75%) Before withdrawing XAU₮ that you deposited as collateral, you should consider if you need to return aUSD₮ to lower your MTV. Withdrawing XAU₮ deposited as collateral, before returning aUSD₮, increases your MTV and therefore increases the risk your XAU₮ could be liquidated. To get back all of the XAU₮ you deposited as collateral, you will need to return all of the aUSD₮ you minted. Note that, in this scenario, users will have to purchase a percentage of their minted amount on the secondary market to cover for the minting and return fee.
How can I interact with the Alloy by Tether Smart Contracts?
Alloy by Tether smart contracts, similar to other smart contracts, offer various avenues for interaction through different tools and frontends.
Among these options, the Alloy by Tether web interface stands out as a key means of engagement.
This web interface is readily accessible at alloy.tether.to .
Please see the Frontend Documentation for more details.
How can I verify my Ethereum Address?
In order for an Ethereum address to be able to mint aUSD₮, it needs to be whitelisted to interact with the aUSD₮ smart contract. Users can apply to be verified and start the related KYC process at the following link.
Once the user verification process is complete, the address may be verified in the Alloy by Tether smart contract and it can then be used to deposit XAU₮ and mint aUSD₮.
What is a Collateral Mint Position?
A Collateral Mint Position (or CMP) is a record of the collateral deposited and aUSD₮ minted and outstanding for a whitelisted Ethereum address as tracked by the aUSD₮ smart contract. The aUSD₮ smart contract keeps track of how many XAU₮ have been deposited and how many aUSD₮ have been minted by each whitelisted Ethereum address, and uses this information, along with the values for XAU₮ and USD₮ reported by the Price Oracle, to compute the Mint to Value ratio (or MTV).
If the MTV ratio exceeds the Liquidation Point (75%), the position is flagged for Liquidation.
What is a Liquidation?
A liquidation happens when a wallet’s Mint To Value ratio (or MTV) reaches the Liquidation Point (75%). If this happens, the user’s XAU₮ held as collateral can be purchased by a liquidator, at a discount from Price Oracle’s reported price for XAU₮, by the liquidator returning aUSD₮ to the aUSD₮ smart contract on the user’s behalf (and by doing so, reducing the user’s MTV). Liquidations are performed by whitelisted liquidators.
Find more information on Liquidations and Liquidation Price here.
What is the Liquidation Price?
When a Collateral Mint Position’s (or CMP’s) Mint to Value ratio (or MTV) exceeds the Liquidation Point, it is made available for liquidation to any whitelisted liquidator. In the web interface, the value of XAU₮ (reported by the Price Oracle) at which your CMP’s MTV exceeds the Liquidation Point, and your CMP will therefore be subject to liquidation, is referred to as the Liquidation Price. Find more information on Liquidations and Liquidation Price here.
What Fees are involved in Alloy By Tether?
There are currently three fees paid by users to Tether AbT in the Alloy By Tether design: 1) Mint Fee: 25 bps are charged on top of each newly minted aUSD₮.
2) Return Fee: 25 bps are charged on each aUSD₮ return.
3) Liquidation Fee: 75 bps are charged to the liquidators on each liquidation of XAU₮.
Please see the Fee Schedule for more details.
On What Networks can be aUSD₮ minted and traded?
Alloy by Tether smart contracts are currently deployed on the Ethereum Mainnet.
Is there a minimum Tether Gold collateral on the aUSD₮ acquisition/minting process?
No, users can choose whatever amount of XAU₮ they want, as long as they are verified Alloy By Tether customers and their Collateral Mint Position’s (or CMP’S) Mint to Value ratio (MTV) does not exceed the Liquidation Point (75%).
What are unissued aUSD₮?
Unissued aUSD₮ are aUSD₮ ready to be minted but not yet minted by a user and issued into circulation. These aUSD₮ tokens remain idle in the Alloy by Tether smart contract, awaiting users to mint them against XAU₮ tokens they deposited to the aUSD₮ smart contract as collateral.
What is the maximum amount of aUSDt that can be minted with a given amount of collateral?
The maximum amount of aUSD₮ that can be minted is determined by the Mint to Value ratio. The maximum Mint to Value (MTV) for a Collateral Mint Position (or CMP) on the aUSD₮ smart contract is 75%. If a CMP’s MTV increases above the 75% Liquidation Point, it is subject to Liquidation.
What are the advantages of owning (aUSD₮)?
aUSD₮ offers the daily usability of fiat currency as a unit of account, combined with the peace of mind that comes from being backed by Tether Gold, providing direct exposure to physical gold.
Leveraging Alloy by Tether’s groundbreaking tethered assets technology, aUSD₮ ensures constant transparency and auditability. It operates independently of the banking system, existing as a resilient, fully on-chain solution.
What is the difference between Tether’s fiat pegged tokens (like USD₮), Tether Gold tokens (XAU₮) and Alloy by Tether (aUSD₮)?
Tether’s fiat pegged tokens are stablecoins pegged at a one-to-one rate with a matching fiat currency and are backed 100% by Tether’s reserves (e.g., 1 USD₮ = 1 USD). The assets are referred to as stablecoins because they offer price stability as they are pegged to a fiat currency. More information can be found here.
Tether’s fiat pegged tokens offer traders, merchants, and funds a low volatility exit for their positions.
The available Tether fiat pegged tokens are:
USD-pegged Tether Tokens (USD₮)
EUR-pegged Tether Tokens (EUR₮)
CNH-pegged Tether Tokens (CNH₮)
MXN-pegged Tether Tokens (MXN₮)
The Tether Gold token (XAU₮) is a digital asset offered by TG Commodities Limited. One XAU₮ represents ownership of one fine troy ounce of gold on a gold bar that meets the LBMA’s Good Delivery standard. Note: The minimum purchasing amount to purchase XAU₮ from TG Commodities Limited is 50 XAU₮ or 50 fine troy ounces. Users can also acquire XAU₮ on trading platforms that have listed XAU₮.
Launched in 2024, aUSD₮ builds on the innovative technology previously developed by Tether. It introduces the first Tethered Asset, offering a fully on-chain and transparent system designed to provide users with an additional tool for everyday use. Different from Tether’s fiat pegged tokens and Tether Gold, Alloy by Tether tracks its reference price by overcollateralization, liquidations and secondary market liquidity rather than direct redemption rights. More information can be found here.
How to buy the XAU₮ needed to mint aUSD₮?
To buy Tether Gold (XAU₮) token on the Tether Gold platform, you will first need to log in/sign up for Tether Gold and verify your identity (whether it is an Individual or a Corporate account).
Then, you will need to go to the Acquire section.
Here, provide the address where you wish to receive the Tether tokens and type in the amount (minimum 50 XAU₮ or 50 troy ounces per request). Note: The charge will be provided to you once the amount is entered and the request is reviewed by admins (the price is based on our cost to acquire gold in the Swiss gold market plus applicable fees). This information will be communicated to you by our admins before processing the request on our end.
After that, choose your bank account via the dropdown list (if you have verified more than one bank account).
Once the form is completed, click the Confirm button to finalise the process. Note: processing a request usually takes 3-5 business days.
Alternatively, you can buy XAU₮ in secondary markets (e.g. centralised exchanges like Bitfinex). Finally, XAU₮ tokens are fully fungible, and can also be acquired on secondary decentralized markets available on the Ethereum Blockchain.
What is the minimum aUSD₮ minting allowed?
There is currently no minimum mintable amount of aUSD₮. Users can mint as little aUSD₮ as they want, without any restrictions on size ,as long as they have deposited enough collateral so they do not exceed the 75% maximum Mint to Value (MTV).
How to verify an Individual account on Alloy by Tether?
Alloy by Tether has adopted an online verification procedure requiring you to complete an online questionnaire and attach certain documents as support. You will also need to agree to the Alloy by Tether Terms of Use.
Verification documents required for Individual accounts:
Two (2) forms of photo identification
Proof of address (utility bill, letter from a government dept., tax statement) no older than 90 days
Selfie photo (holding accepted photo ID and holding a note stating: “To Tether” and listing the current date with signature)
Personal bank statement
Important:
Photo identification constitutes photo identification from a government authority including an International Passport, and both sides of a National ID card or Driver’s License.
Proof of residency constitutes a utility bill, service bill, government tax statement, lease, or mortgage statement that is less than three months old, clearly showing the individual name and address.
All documents provided must be in the Roman/Latin alphabet, or a certified English translation is required and formatted as pdf, jpeg, or png.
All fields in the following verification form are mandatory (NA for Non-Applicable can be used)
To avoid possible delays, please check the correctness before submitting documents and double-check you do not send the same document twice and possibly forget one.
Once your KYC submission is reviewed by the Compliance Department, Alloy by Tether may require additional information as part of our EDD (Enhanced Due Diligence) procedures.
What is the user registration process for Alloy by Tether?
A new user can begin the registration process by filling in their personal details on the Tether sign up page here.
As part of Tether’s robust security measures, the user must activate Two-Factor Authentication (2FA) for their Tether account. The user must pay a verification fee of 150 USD₮ (the amount is non-refundable but can be part of future redemptions for fiat pegged Tether tokens). Please see the Alloy by Tether Fee Schedule for more information.
The user must then undergo a verification process, either as an individual or corporate entity, and submit all required documents. To submit the Verification form to apply the Alloy by Tether service, a new user must first sign up to and get verified with the Tether Gold service.
Alloy by Tether’s compliance team will then review the user’s verification request. As Tether’s robust Know Your Customer (KYC) process includes conducting due diligence on all customers and rating the risks of every customer, this review could take days to weeks to complete. The user will be notified once account verification has been completed.
Once the user has been verified as an Alloy by Tether user, they can submit one or more Ethereum addresses to be whitelisted to transact with the Alloy by Tether smart contract. Once an address has passed the due diligence and has been verified, the user is set to start using the Alloy by Tether service.
How to verify a corporate account on Alloy by Tether?
Alloy by Tether has adopted an online verification procedure requiring you to complete an online questionnaire and attach certain documents as support. You will also need to download, sign and upload a declaration form confirming the accuracy of the information provided and authorising Tether to verify the information.
Verification documents for Corporate accounts:
Certificate of Incorporation and Business Registration
Memorandum and Articles of Association (which evidence the powers that regulate and bind the company)
Certificate of Incumbency or similar document(s) listing the officers, directors, shareholders and/or other individuals with signing authority
Certificate of Good Standing issued by government authorities, dependent upon the jurisdiction of organization. This document is also known as a “certificate of existence”, “certificate of authorisation” or simply proof of continued registration (as in the case of Hong Kong) which certifies the legal entity in question is still in existence and has not been dissolved or merged.
Board resolution authorising the agent/contact to transact with Alloy by Tether
Documents sufficient to describe the ownership and control structure of the company indicating % interests of ultimate beneficial owners
Company Bank Statement
List of current members registered
List of current officers registered
List of current directors registered
Proof of registered office and business address (if different from the registered office)
For the ultimate beneficiary owning 10% or more, directors, authorized signatories, and contact/agent, the following are required:
Two (2) forms of photo identification
Proof of address (utility bill, letter from a government dept., tax statement) no older than 90 days
Selfie photo (holding accepted photo ID and holding a note stating: “To Tether” and listing the current date with signature)
For shareholding entities owning 10% or more the following are required:
Certificate of Incorporation
Memorandum & Articles of Association
Details of Ownership Structure (if not stated in the Memorandum & Articles of Association)
Shareholder Registrar
Certificate of Good Standing
Important:
Photo identification constitutes photo identification from a government authority including an International Passport, and both sides of a National ID card or Driver’s License.
Proof of residency constitutes a utility bill, service bill, government tax statement, lease, or mortgage statement that is less than three months old, clearly showing the individual name and address.
All documents provided must be in the Roman/Latin alphabet, or a certified English translation is required and formatted as pdf, jpeg, or png.
All fields in the following verification form are mandatory (NA for Non-Applicable can be used). To avoid possible delays, please check the correctness before submitting documents and double-check you do not send the same document twice and possibly forget one.
Once all of the above has been submitted and reviewed by the Compliance Department, Alloy by Tether may require additional information as part of our EDD (Enhanced Due Diligence) procedures.
Is Alloy by Tether transparent?
Yes. Alloy by Tether’s platform is built to be transparent at all times. All aUSD₮ Tokens in circulation are overcollateralised by XAU₮.
By using smart contracts to regulate the minting and returning of aUSD₮ tokens, Alloy by Tether allows full on chain transparency about the XAU₮ backing each aUSD₮ and all users positions.
Does Alloy by Tether provide Attestations?
Yes, Alloy by Tether publishes Attestation reports on a quarterly basis prepared by an independent third-party accounting firm. Such Attestation reports are prepared in accordance with criteria established by the International Auditing and Assurance Standards Board (IAASB).
Additionally, each user can verify at all times the amount of the XAU₮ backing the issued aUSD₮, by using traditional block explorers like Etherscan.
Is Alloy by Tether licensed in any jurisdiction?
Moon Gold NA, S.A. de C.V., and Moon Gold El Salvador, S.A. de C.V., both authorized by the CNAD in El Salvador, will handle the issuance and management of Alloy by Tether, catering to different customer segments and regulatory requirements.
Moon Gold NA, S.A. de C.V. is a Salvadoran company registered in El Salvador. It is a Stablecoin Issuer authorized by the CNAD under the resolution CNAD-CD-048-2024; and Digital Assets Service Provider (DASP) authorized by the CNAD with the Registration Number PSAD-0021.
Moon Gold El Salvador, S.A. de C.V. is a Salvadoran company registered in El Salvador. It is a Stablecoin Issuer authorized by the CNAD under the resolution CNAD-CD-047-2024 and Digital Assets Service Provider (DASP) authorized by the CNAD with the Registration Number PSAD-0022.
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