Stablecoin News: Tether USDT and Circle Announce Competing Infrastructure Bets on Same Day

Key Insights:

• Stablecoin news showed that Tether and Circle announced strategic infrastructure investments on February 10.
• Tether backed LayerZero Labs for cross-chain interoperability, while Circle invested in edgeX for perpetuals trading infrastructure.
• Tether USDT claimed its LayerZero-based USDt0 moved over $70 billion cross-chain in under twelve months.

Tether and Circle both disclosed strategic bets on February 10, targeting different layers of the stablecoin infrastructure stack.

Tether-backed LayerZero Labs, describing it as “production-grade interoperability infrastructure” used to build USDt0 and XAUt0 via LayerZero’s Omnichain Fungible Token standard.

Meanwhile, Circle announced its investment in edgeX, the team behind EDGE Chain, a layer-3 blockchain powering a perpetual DEX built for CEX-like speed.

The stablecoin news announcements were made on the same day, even though they focused on different choke points.

Circle targeted where trading volume concentrates, while Tether targeted how liquidity moves across chains without fragmentation.

The synchronized timing suggested both issuers recognized the same strategic pressure: stablecoins are now treated as market infrastructure by regulators and institutions.

Stablecoin News: Circle Bets on Perpetuals Settlement Infrastructure

Circle disclosed that native USDC and its Cross-Chain Transfer Protocol are coming to EDGE Chain, a layer-3 blockchain leveraging Arbitrum for security and finalizing on Ethereum.

As per the stablecoin news, the company framed EDGE Chain as a “high-performance” environment and described edgeX as a “fast-growing perpetual DEX.”

Circle’s CCTP model uses burn-and-mint mechanics for native USDC transfers, reducing reliance on liquidity-pool bridges and wrapped assets.

The approach is designed to make USDC more usable as collateral and settlement across venues like EDGE, where derivatives activity demands canonical stablecoins and clean cross-chain paths into margin and settlement workflows.

edgeX positioned generalized blockchains as unable to support institutional-grade derivatives performance reliably.

The platform described itself as an “app-specific execution layer” purpose-built for high-frequency on-chain derivatives. In this category, stablecoin news now centers on distribution inside derivatives stacks rather than only on L1 and L2 spot DeFi.

Stablecoin News: How Circle’s CCTP iInteroperability Works | Source: Li.fi Research

Tether USDT Backs Interoperability to Prevent Fragmentation

Tether framed its LayerZero investment as infrastructure that keeps stablecoins and tokenized assets usable across many chains “without fragmentation or loss of liquidity.”

The company said Everdawn Labs has used LayerZero’s infrastructure to build USDt0 and XAUt0 using the OFT standard. It claimed that USDt0 facilitated more than $70 billion in cross-chain value transfers in under 12 months.

The USDt0 and XAUt0 implementations use a lock-and-mint approach, where the native asset is locked on one chain, and a corresponding omnichain representation is minted elsewhere.

At least some implementations are managed by Everdawn Labs rather than being directly issued or redeemable by Tether, introducing a layer of third-party operational governance that differs from Circle’s burn-and-mint model.

Tether positioned LayerZero alongside its Wallet Development Kit for payments, settlement, custody, and “agentic finance,” framing the investment as an infrastructure utility rather than just balance-sheet scale.

The move came amid renewed US regulatory attention on Tether and reported fundraising ambitions.

Stablecoin News: Two Cross-Chain Philosophies Harden Into Issuer Strategy

As per stablecoin news, Circle’s CCTP model and Tether’s OFT-based approach represent different trust architectures.

CCTP explicitly burns native USDC on one chain and mints it on another, maintaining issuer control over the canonical asset throughout the transfer.

USDt0’s lock-and-mint approach introduces adapter contracts and third-party governance layers, shifting where risk concentrates.

The difference matters for how institutions, regulators, and exchanges evaluate issuer control, redeemability, and operational risk.

Circle is embedding USDC where trading activity concentrates, positioning canonical issuance and clean cross-chain movement as distribution moats.

Tether is hardening the transport layer to keep USDT-like units dominant even as activity fragments across chains.

DefiLlama’s stablecoin dashboard showed a total stablecoin market cap of approximately $308 billion, with USDT accounting for nearly 60% at the time of the announcements.

USDT and USDC remain the two largest stablecoins by market cap, underscoring the category’s concentration at the issuer level.

Stablecoin Market Supply by Asset | Source: DefiLlama

Policy Pressure Pushes Issuers Toward Rails Narratives

Stablecoin policy debates increasingly treat issuers as infrastructure advisors rather than just token minters.

In the US, the GENIUS Act formalized payment stablecoins as a regulated category with explicit federal framing.

The White House is convening efforts around digital asset legislation, the CLARITY Act, with stablecoin interest and rewards as a core sticking point between banks and crypto firms.

In the UK, the Bank of England’s consultation work on systemic stablecoins centered on issuer business models and explicitly argued that systemic issuers should not pay interest to coinholders.

In Europe, MiCA implementation and compliance registers made stablecoin issuance and service-provider compliance a visible, ongoing process.

The regulatory framing rewarded issuers who could argue they delivered safer primitives, such as canonical issuance and clean cross-chain movement, rather than shadow-banking functions.

Both Circle and Tether anchored their announcements to already-operational primitives rather than blue-sky R&D.

Stablecoins Race to Become Settlement Rails

Circle’s investment placed USDC and CCTP directly into a chain whose core pitch was perpetual performance and CEX-like speed.

The move implies that stablecoin news now centers on distribution within derivatives stacks, where institutional-grade execution environments require canonical settlement assets.

Tether’s LayerZero investment supports the complementary thesis: if stablecoins are to function as global settlement instruments, the transport layer must prevent liquidity fragmentation across multiple chains.

The USDt0 claim of over $70 billion in cross-chain value transfer in under twelve months served as an issuer-stated proxy for how large interop rails usage could get.

The strategic symmetry revealed a shared understanding of where stablecoin demand is shifting. Both issuers recognized that the next growth battleground lies either in where trading volume concentrates or in how liquidity moves across chains without fragmentation.

The stablecoin news from February 10 signaled a convergence: issuers are starting to look like platform companies that will compete on distribution rails and on embedding stablecoins into high-velocity financial apps.

Circle is buying distribution inside a derivatives execution environment, while Tether is buying resilience and portability of its asset footprint across chains.

The bifurcation into competing trust models, such as burn-and-mint versus lock-and-mint adapters with third-party governance, is likely to become a due diligence wedge for institutions, regulators, and exchanges.

The headline risk for both issuers is that distribution becomes regulated infrastructure, making stakes in the plumbing a hedge against policy-driven chokepoints.

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