tl;dr
Tether has partnered with LayerZero to launch USDT0, a multichain version of the Tether USD stablecoin. USDT0 utilizes the Omnichain Fungible Token (OFT) standard to enable cross-chain transfers and unify liquidity across connected chains. It eliminates the need for intermediary bridges and wrapped ...
Tether and LayerZero have partnered to launch USDT0, a multichain version of the Tether USD stablecoin. This new version uses the Omnichain Fungible Token (OFT) standard to facilitate cross-chain transfers and improve interoperability. USDT0 will utilize USDT tokens locked in a smart contract on Ethereum to mint tokens on target chains in a 1:1 ratio, enhancing its presence across multiple blockchains. The stablecoin will first debut on Kraken's layer-2 blockchain, Ink, and aims to expand to Berachain and MegaETH. Tether's USDT is already available in 11 different blockchains, with a transfer volume exceeding $10.5 trillion, making it the largest stablecoin in the market. The Markets in Crypto-Assets Regulation (MiCA) has affected Tether's euro-backed token operations in the EU, prompting investments in MiCA-compliant stablecoins with Dutch crypto company Quantoz and StablR.
The Omnichain Fungible Token (OFT) standard, developed by LayerZero, will power cross-chain transfers for USDT0, unifying liquidity across connected chains and validating transactions through a decentralized network of oracles and relayers. USDT0 will eliminate the need for intermediary bridges and wrapped assets by using a messaging layer for token transfers. The stablecoin will use USDT tokens locked in a smart contract on Ethereum to mint tokens on the target chain in a 1:1 ratio. Tether's CEO Paolo Ardoino believes that this innovation will scale the stablecoin's presence across multiple blockchains, enhancing interoperability and reducing friction in the user experience.
USDT0 will first debut on Kraken's layer-2 blockchain, Ink, and plans to expand to Berachain and MegaETH, marking the beginning of a "new standard" for stablecoin liquidity, according to Ink's founder Andrew Koller. LayerZero Labs' co-founder and CEO, Bryan Pellegrino, expressed pride in enabling fast and seamless USDT transfers across ecosystems. Tether's USDT is already available in 11 different blockchains and boasts an aggregated transfer volume of over $10.5 trillion, solidifying its position as the largest stablecoin in the market with a $141 billion supply. However, the Markets in Crypto-Assets Regulation (MiCA) has impacted Tether's stablecoin operations in the European Union, leading to investments in MiCA-compliant stablecoins with Dutch crypto company Quantoz and StablR.