- The co-founder of Ethereum, Vitalik Buterin, suggested that stablecoins could let users move value across different blockchains.
- Bitcoin activist Udi Wertheimer said that users don’t care about how systems work as long as they are interconnected.
- Tether’s CTO believes third parties should implement a system solving the problem of lack of interoperability.
According to Vitalik Buterin, the co-founder of Ethereum, the stablecoin industry is missing a significant opportunity to improve interoperability between different blockchains. He took Twitter to suggest that stablecoins could allow users to move value across different blockchains.
In the specific case of issuer-backed stablecoins there’s lots of things that could be done but aren’t, eg. every stablecoin could be an instant cross-chain bridge!
Bitcoin activist and independent developer, Udi Wertheimer, said that something similar to what Buterin is suggesting already exists within exchanges. He explained that a user can deposit the Ethereum version of Tether’s USDT on Binance and immediately withdraw its Omni protocol or Tron (TRX) version. To this, Buterin said that he would like to see a bridge that does not require a user to move funds on an exchange:
I would of course love it if they and USDC and the others could agree on a standardized API (perhaps a ‘bridge contract’ ERC); so I don’t need to bother dealing with Binance accounts to move coins around!
Wertheimer said that while a few industry insiders prefer decentralized solutions, users do not really care about how systems work as long as they are interconnected. Tether’s chief technical officer, Paolo Ardoino, believes that the lack of interoperability is a problem that concerns all digital tokens. According to him, third parties should implement a system solving this problem, not stablecoin issuers.
Tether is the issuer of the stablecoin. There are plenty of projects that are working on solving this problem already. This is a general problem that applies to all the tokens on all the blockchains. […] Now Tether is advising projects that are trying to solve this problem. […] So we have an active role in the process. We are just not developing the solution ourselves.
Ardoino said that one of the biggest challenges in building an interoperability protocol is developing a full understanding of the security implications of each blockchain involved. Jagdeep Sidhu, the co-founder and lead core developer at Syscoin, commented on the challenges of developing inter-chain bridges:
It is easier for projects to make sacrifices to fast-track solutions to market, or to base core interoperability on market-driven trading mechanisms or liquidity providers, only to experience multiple discoveries, or find enterprise adoption can hit roadblocks due to regulatory and legal requirements.
According to a Cointelegraph report, Sidhu said that Syscoin would be “most definitely” interested in partnering with stablecoin issuers to implement its bridge. On the other hand, Ardoino suggested that third parties involved in bringing USDT onto new blockchains are free to port them independently:
Tether is on public blockchains and communities can build and use these cross-chain products in order to move Tether from one chain to another. That is the beauty of it.