Polygon Integrates Native USDT0, Streamlining $1.3 Billion USDT Supply for Enhanced Payments

Polygon, a leading layer-2 scaling solution for Ethereum, has announced a significant upgrade to its ecosystem, introducing native interoperability for Tether’s USDT stablecoin. This development, confirmed by Polygon on social media, impacts over $1.3 billion of USDT supply on the network, promising improved reliability, liquidity, and composability for users. The move aims to facilitate faster and more efficient payments within the Polygon ecosystem.

The core of this upgrade is the adoption of USDT0, an omnichain version of Tether’s USDT, and XAUt0, the omnichain version of Tether Gold (XAUt). Unlike the original Tether-issued tokens, USDT0 and XAUt0 are minted by depositing their respective Tether counterparts into a specific contract on Ethereum, enabling seamless cross-chain movement without relying on traditional bridges or wrapped tokens. This unified liquidity network, operated by Everdawn Labs, simplifies asset transfers across various blockchain networks.

Polygon’s decision to integrate USDT0 and XAUt0 is strategic, leveraging its robust ecosystem that boasts over $1 billion in existing USDT liquidity and more than 6 million wallets. Lorenzo R, co-founder of USDT0, emphasized that Polygon’s growth in stablecoin payments, decentralized finance (DeFi), and enterprise adoption makes it an ideal platform for this integration. The upgrade also capitalizes on Polygon's recent infrastructure enhancements, including the AggLayer and Bhilai Hardfork, which further support scalable and efficient transactions.

The transition is designed to be seamless for existing users, as the current Polygon Proof-of-Stake (PoS) USDT will be upgraded to the USDT0 standard, retaining the same contract address. Since its launch in January 2025, USDT0 has seen rapid adoption, with its market capitalization climbing to nearly $1.6 billion within two months. This integration is expected to bolster Polygon’s position as a hub for institutional-grade real-world asset (RWA) adoption, DeFi applications, and general payments, enhancing the overall user experience.