Tether and LayerZero announced on Jan. 16 a joint effort to launch USDT0, a multichain version of the Tether USD (USDT) stablecoin.
The Omnichain Fungible Token (OFT) standard, developed by LayerZero, will power the cross-chain transfers. According to USDT0 documentation, OFT unifies liquidity across connected chains and validates transactions through a decentralized network of oracles and relayers.
The documentation also claims to eliminate the need for intermediary bridges and wrapped assets by applying a messaging layer to send tokens. Additionally, USDT0 uses USDT tokens locked in a smart contract on the Ethereum mainnet.
Once assets are locked, USDT0 tokens are minted on the target chain in a 1:1 ratio, reflecting the locked assets on Ethereum. Users can redeem USDT0 tokens by unlocking the corresponding USDT on Ethereum.
Tether CEO Paolo Ardoino stated:
“By improving interoperability and reducing friction, it enhances the user experience in ways that align with the broader vision of Tether. It’s exciting to see this innovation emerge and tackle real market demand.”
He added that this new multichain version of USDT will help scale the stablecoin’s presence across many more blockchains.
USDT0 will debut on Kraken’s layer-2 blockchain, Ink, and intends to launch on Berachain and MegaETH in the coming weeks.
Andrew Koller, founder of Ink, said that USDT0’s choice of Ink as its first chain marks the beginning of a “new standard” for stablecoin liquidity.
Meanwhile, Bryan Pellegrino, co-founder and CEO of LayerZero Labs, added that the firm is proud to enable fast and seamless USDT transfers throughout all ecosystems.
Boosting expansion
USDT is already available in 11 different blockchains. According to Artemis data, its aggregated transfer volume in the past year was over $10.5 trillion as of Jan. 16.
Additionally, the stablecoin sits comfortably as the largest stablecoin in the market, with a $141 billion supply, nearly $100 billion above the runner-up USD Coin (USDC). It has grown 51% since January 2024.
Notably, the Markets in Crypto-Assets Regulation (MiCA) impacted Tether stablecoin operations in the European Union, with the firm shutting down its euro-backed token EURt. Meanwhile, Circle covered the ground with its Euro Coin (EURC), which is compliant with the new rules.
Nevertheless, Tether responded by investing in the Dutch crypto company Quantoz to issue MiCA-compliant stablecoins. Moreover, the firm led by Paolo Ardoino made an additional investment in StablR with the same goal.
The post Tether partners with LayerZero to launch cross-chain stablecoin USDT0 appeared first on CryptoSlate.
