TL;DR Wanchain bridges add native-to-native USDT crosschain transfers. Native-to-native USDT crosschain transfers are now live on Ethereum, BNB Chain, OKC, Polygon & Arbitrum! Tron and Avalanche C-Chain coming soon!
Tether’s USDT is the world’s leading stablecoin by means of total market capitalisation. Users worldwide use it to trade between cryptocurrencies and to store value during times of market volatility. It is no surprise, then, that USDT is the single most liquid cryptocurrency in the world as measured by trading volume.
USDT is minted natively on more than a dozen blockchains, including Ethereum, OKC and Polygon. Until now, the easiest way to move USDT between these chains was to use centralised exchanges. That’s no longer true!
Beginning today, users can use Wanchain’s industry-best crosschain bridges to execute decentralised, non-custodial native-to-native USDT crosschain transfers between Ethereum, BNB Chain, OKC, Polygon and Arbitrum — colloquially referred to as XFlows!
What is USDT XFlows?
USDT XFlows is a decentralised cross-chain solution that enables native-to-native crosschain transfers between blockchains where USDT is natively minted by Tether. XFlows leverage the power of Wanchain’s cross-chain bridges to provide easy, non-custodial transfers between chains without the need for centralised exchanges.
What happens to pre-existing USDT bridges?
Using the lock-mint-burn-unlock mechanism that Wanchain itself pioneered, users have long been able to bridge USDT from Ethereum to other EVM-compatible chains such as Wanchain, Fantom and XDC Network. As a quick reminder, when using the lock-mint-burn-unlock method, the native USDT on the source chain is locked before a mirrored copy, or wrapped-USDT, is minted on the destination chain. To unlock the original USDT, the wrapped-USDT must first be destroyed, or burned.
Wanchain’s new USDT XFlows exist alongside these preexisting USDT bridges. Now, when bridging USDT to another network, users will automatically receive native USDT if native USDT exists on the destination chain. Conversely, if native USDT does not exist on the destination chain, users will receive wrapped-USDT. It is a completely seamless experience powered by Wanchain’s crosschain bridges.
How does USDT XFlows work?
When bridging an asset that is minted natively on both the source and destination chains, using a lock-mint-burn-unlock mechanism doesn’t make much sense. If someone bridges their USDT from Ethereum to Polygon, surely, they want to receive real USDT on Polygon! This makes the lock-mint-burn-unlock mechanism ill-suited to these kinds of native token-to-native token crosschain transactions. Luckily, Wanchain’s bridges are compatible with decentralised liquidity pools!
Liquidity pools have traditionally served as a secondary bridging mechanism. The prerequisite to bridging using liquidity pools is to have two-or-more pools of assets on two-or-more chains. These liquidity pools are then automatically rebalanced as crosschain transactions occur. In other words, if someone bridges their USDT from Ethereum to Polygon, their USDT is first added to the pool on Ethereum before the same number of USDT is removed from the pool on Polygon.
With this new solution, Wanchain bridge nodes balance pools of native USDT on Ethereum, BSC, OKC, Polygon & Arbitrum to enable native USDT crosschain transfers; all without sacrificing security and decentralisation. USDT XFlows are executed using the same secure multi-party computation (sMPC) architecture that distinguishes Wanchain’s interoperability solutions.
Who provides the USDT liquidity?
Liquidity pool bridges have historically used one of two primary methods to ensure liquidity: centralised liquidity and incentivised liquidity. Centralised liquidity, as the name implies, is provided by a singular entity or group of permissioned entities. Incentivised liquidity is provided by users in return for yield, usually in the form of a reward token. With these new native USDT crosschain transfers, Wanchain is introducing a third method.
The USDT liquidity powering Wanchain’s new USDT XFlows is provided by users who bridge their USDT to another network using the lock-mint-burn-unlock mechanism. Said another way, the USDT that is locked on a source chain before minting a wrapped-USDT on a destination chain doubles as the liquidity powering native-to-native USDT crosschain transfers.
The combination of the lock-mint-burn-unlock and liquidity pool methods is a major innovation in the field of crosschain technology. The number of wrapped-USDT in circulation is always equivalent to the total native USDT locked in liquidity pools across all chains. As more wrapped-USDT is minted — no matter on what network — more native USDT is added to the liquidity pools. These new USDT XFlows are both owned and powered by the people!
What bridge routes are currently available?
USDT XFlows is currently supported by direct bridges connecting Arbitrum, BNB Chain, CLV P-Chain, Ethereum, Moonriver, OKC, Polygon, Wanchain and XDC Network. The specific routes are:
Anything else?
In the future, Wachain’s USDT XFlows will support native USDT on Avalanche C-Chain and Tron. Additionally, USDC XFlows are also on the horizon.
About Wanchain
We are all connected — Wanchain, the Wide Area Network chain, is the world’s premier decentralised blockchain interoperability solution. Our mission is to drive blockchain adoption through interoperability by building fully decentralised bridges that connect the world’s many siloed blockchain networks. This crosschain infrastructure empowers developers to build truly decentralised crosschain applications to power the future of Web3.
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