Uniswap Restarts Liquidity Mining, Involving Multiple USDT0 Related Pools
This article is sourced from a piece by 0xTodd and reprinted by Foresight News.
(Background: Tether’s cross-chain stablecoin “USDT0” has launched on Optimism and Unichain. What is USDT0? What problems can it solve?)
(Supplementary Background: What is the anti-inflation stablecoin USDi? It is pegged to the U.S. CPI and aims to protect cash purchasing power.)
Isn’t Uni set to restart liquidity mining on April 15? This time it involves 12 pools, many of which are related to $USDT0. So, taking this opportunity, I will discuss USDT0.
First of all, what is USDT0?
Simply put, it is the cross-chain version of USDT. The underlying asset USDT resides on ETH, and through Layer0, it crosses over to other chains, becoming USDT0. The supported USDT0 can also cross over to each other, such as ETH-Arb-Unichain-Bear Chain-megaETH, etc.
Who is behind USDT0?
This is the trickiest part; it took me quite a while to sort this out. The USDT0 project is backed by a collaboration of 1+3 entities:
- Leading by Everdawn Labs;
- 1. The underlying technology used is Layer0;
- 2. Endorsed by Tether;
- 3. Endorsed by INK public chain (this is the chain launched by Kraken).
However, who exactly is Everdawn Labs? There is no clue on the internet.
I reasonably suspect that it is a front for Tether. This fits their style well:
- If nothing goes wrong—everyone can enjoy the multi-chain convenience of USDT;
- If something goes wrong—it’s Everdawn Labs’ fault, and Tether has nothing to do with it.
One reason for this speculation is that after USDT0 was launched this year, Tether immediately expressed support, and subsequently, Bitfinex also published a special article to explain it. Without a strong relationship, they (BF and Tether) would not provide such support.
How to evaluate it?
I believe if Tether were to personally build this bridge, it would be a significant accomplishment, as it would allow USDT to move seamlessly across chains without relying on various unreliable third-party cross-chain bridges.
However, my level of trust in Layer0 is limited. There have been numerous high-profile failures of cross-chain bridges in the past, from Multichain to Thorchain. The technology of cross-chain operations has no barriers; it’s just a matter of multiple tokens.
Historically, USDT has always used the official bridge, rather than a third-party bridge like L0. Official bridges are generally safer, but the downside is that liquidity is dispersed.
For example, if you want to transfer large amounts of capital from Arb to OP without loss, you must first Arb back to ETH before going to OP, and using a third-party bridge quickly incurs costs.
PS: Not to mention there are also troublesome public chains like Sei, where official bridges charge fees for entry and exit.
In contrast, using the USDT0 solution, Arb can go directly to OP, with no loss and instant transfer.
PS: Of course, there is still a historical issue regarding OP, as all USDT on OP are older cross-chain versions from ETH, not the new USDT0 version, so while the nominal transfer from Arb to OP is feasible, it is practically useless; this is just an example.
New public chains, having supported USDT0 from the start, do not have historical issues, making them much more usable.
But!
Tether itself is reluctant to personally build this bridge and instead sends out Everdawn Labs, which feels a bit…
Previously, when I mined $UNI on ETH, I only had to bear the small third-party risks from Tether and Uniswap. Now, I have to bear an additional four risks:
- Everdawn might cause issues;
- L0 might cause issues;
- Unichain might cause issues;
- USDT0 supports other N public chains; each one might cause issues.
(If another public chain gets hacked and USDT0 is infinitely minted, then the USDT0 on other chains could also be compromised.)
It sounds a bit overwhelming.
