Polkadot Investors Unimpressed With Tether News
Polkadot (DOT) investors seem to be unimpressed by the news that the most popular stablecoin is coming on this blockchain.
The issuer of the stablecoin, Tether, announced today that tether (USDT) will launch on Polkadot, becoming the first stablecoin on this network.
However, DOT, ranked 6th by market capitalization, is moving lower today after it rallied by 25% in a week. At 14:20 UTC it trades at USD 42.82 and is down by 2% in a day, becoming the worst-performing coin in the top 10 club today.
In either case, USDT is first set to go live on the canary network Kusama, before being deployed on the Polkadot mainnet, a blockchain created by Gavin Wood, co-founder of Ethereum (ETH), and developed by Web3 Foundation.
As reported, the experimental version of Polkadot, called Kusama, launched in July 2019, with real economic conditions, for developers to experiment in and test out a Polkadot-like environment. Less than a year later, in May 2020, as Polkadot Network - one of the top 10 ICOs of 2017 - went live as well.
Polkadot is a sharded protocol that enables different blockchain networks to operate together. It allows connecting and launching blockchain applications by using parachains (sovereign blockchains, or shards, with unique functions) to link to different networks.
The launch of USDT on Polkadot is pending the formation of these parachains, as independent chains that can have their own tokens and be optimized for specific use cases, the emailed press release said. Parachains will first launch on Kusama, which is why USDT will deploy on that network first prior to becoming available on Polkadot.
The announcement said that,
The aim is to ensure that when USDt is available, it will become the first ever stablecoin on the Polkadot network.
Per Polkadot's road map, the network is currently in the "parachain rollout" phase. They will first be tested on testnets like Rococo, then will be launched on the Kusama proving ground, and finally on Polkadot, which will mark the network's full launch. "Polkadot is now on track to launch several parachains in 2021," it said.
Per Paolo Ardoino, Chief Technology Officer at Tether and crypto exchange Bitfinex, the company anticipates "a ready uptake of the Tether token as it powers Polkadot’s emerging DeFi [decentralized finance] ecosystem." Ardoino added that, with its parachain structure, Polkadot "has the ability to grow significantly in the coming years [...] driven by its high level of scalability."
At the same time, "teams building decentralized applications in with a multi-chain future in mind are increasingly looking towards established stablecoins that operate across numerous networks to ensure a smooth experience for their users," said Peter Mauric, Head of Public Affairs at Parity Technologies, who have served as Polkadot's initial core development team. USDT's launch on Kusama and Polkadot is "a crucial step" towards that goal, "where developers will be able to seamlessly compose trustless applications across chains, networks and communities," he said.
USDT works on a number of different blockchains, including Algorand (ALGO), Ethereum, Tron (TRX), EOS, OMNI, Solana (SOL), Liquid Network, and Bitcoin Cash (BCH)'s Simple Ledger Protocol (SLP).
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