Stader ETHx (ethx) 
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As the cryptocurrency landscape continues to evolve, the integration of real-world assets into blockchain ecosystems is gaining momentum. One of the most notable advancements in this area is the introduction of XAUt0, a new iteration of Tether Gold. Designed to operate across multiple blockchains, XAUt0 is built on the LayerZero Omnichain Fungible Token (OFT) standard. This innovation allows users to transfer gold-backed tokens seamlessly between networks without the need for risky bridges or wrapped tokens.
What is XAUt0 and Why Does It Matter?
XAUt0 represents a significant step forward for tokenized commodities. Unlike its predecessor, XAUt, which exists solely on Ethereum, XAUt0 leverages omnichain technology to expand its usability across multiple blockchain ecosystems. This development eliminates liquidity fragmentation and reliance on legacy mesh solutions. According to Lorenzo R, Co-Founder of USDt0, “XAUt0 acts as the main expansion and interoperability solution for XAUt, making it more accessible for users.”
How Does Gold Ownership Work with XAUt0?
Each XAUt0 token represents ownership of one fine troy ounce of LBMA-standard gold stored in a Swiss vault. The legal structure behind this ownership is robust. TG Commodities S.A., based in Switzerland, holds the legal title to the gold bars. Token holders have a contractual right to this gold under Swiss custodial rules. To redeem the gold, users must verify their accounts with TG Commodities and follow the redemption process outlined by Tether Gold.
“If a user wanted to redeem their XAUt0 tokens, they would first send them back to Ethereum, receive their corresponding amount of XAUt, and then complete the redemption process directly with TG Commodities,” explains Lorenzo.
Direct Ownership vs. ETFs and Synthetic Tokens
One of the key advantages of XAUt0 is its ability to provide direct ownership of physical gold, unlike ETFs or synthetic tokens that only offer price exposure. Each XAUt0 token is tied to a specific ounce of gold in a Swiss vault, allowing users to redeem the exact bar tied to their holdings. This level of transparency and security sets XAUt0 apart from traditional financial instruments like gold ETFs (e.g., $GLD) or crypto-backed tokens such as PAXG.
Additionally, XAUt0 offers on-chain auditability. For every XAUt0 in circulation, there is a corresponding XAUt token on Ethereum, which is backed by physical gold. This ensures that users can independently verify reserves and maintain trust in the system.
How is XAUt0 Classified and Regulated?
From a regulatory perspective, XAUt0 is classified as a stablecoin denominated in ounces of gold rather than USD. Its classification as a commodity token, security, or stablecoin depends on jurisdiction-specific regulations. However, Lorenzo emphasizes that XAUt0 is a representation of XAUt on different blockchains, maintaining its legal and compliance framework under Swiss law.
Security Measures for XAUt0
Security is a critical aspect of XAUt0’s design. The LayerZero protocol, which underpins XAUt0, incorporates multiple fail-safes, including Dual DVN Verification and Endpoint Validation. These mechanisms ensure that no minting or redemption can occur without validated communication. Additionally, all XAUt0 contracts have undergone thorough audits, and the platform maintains one of the largest bug bounty programs in the world to identify and mitigate potential vulnerabilities.
Why Launch XAUt0 on TON?
The initial deployment of XAUt0 was on the TON blockchain through the Wallet in Telegram platform. This decision was driven by a longstanding partnership between the teams and a shared commitment to permissionless innovation. TON’s ecosystem provides a seamless and accessible way for users to interact with programmable, physically-backed assets like gold.
“This rollout reflects our shared vision: making programmable, physically-backed assets like gold as accessible and seamless to use as any native digital token,” says Lorenzo.
The Future of Tokenized Commodities
Looking ahead, Tether is exploring the possibility of issuing other omnichain tokens for commodities such as oil and silver. The broader vision is to bring real-world assets into decentralized finance (DeFi) ecosystems, providing users with new opportunities for value storage and investment. According to Lorenzo, the focus remains on deploying Tether assets on chains that offer significant growth potential in terms of user engagement, volume, and innovative use cases.
As the integration of real-world assets into blockchain ecosystems continues, XAUt0 serves as a promising example of how tokenized commodities can bridge the gap between traditional finance and DeFi, offering users greater accessibility and security.
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