As digital assets evolve, we’re starting to see more real-world value being brought on-chain, quite literally.
One of the most interesting developments is XAUt0, a new version of Tether Gold designed to work across multiple blockchains. Built on LayerZero’s OFT standard, it lets users move gold-backed tokens between networks without relying on risky bridges or wrapped tokens.
In this Q&A, Lorenzo R, Co-Founder of USDt0, walks us through how it all works and why this is such a big deal for the future of crypto and commodities. Lorenzo breaks down what “omnichain” really means in simple terms, explains how gold ownership is structured behind the scenes, and shares why they launched on Telegram’s TON network first.
He also touches on the broader vision: giving people easier access to real, redeemable assets like gold, without the headaches of traditional finance.
Below is the complete Q&A with Lorenzo R.
crypto.news: XAUt (Tether Gold) has been live since 2020 as a token on Ethereum. Beyond enabling cross-chain transfers, what are the key technical and strategic enhancements in XAUt0 compared to the original XAUt?
Lorenzo R: With USDT0, we’ve now expanded Tether to 11 more chains and will continue to do so at scale. USDt0 is the missing link to Tether’s ongoing expansion, XAUt0 is USDT0’s next move in development. USDt0 acts as the connective tissue that enables Tether’s ecosystems to thrive in today’s multi-chain world. XAUT lives only on Ethereum mainnet, and xaut0 is used to expand this asset across chains. No liquidity fragmentation and no need for a legacy mesh solution since we are the ones to expand the asset across chains.
The main enhancement of XAUt0 remains its cross chain nature, the “token” side of the system works exactly the same as any other ERC20 tokens. We are not re-inventing the wheel, we are just making it more accessible for users, acting as the main expansion and interoperability solution for XAUt.
CN: Each XAUt0 token represents ownership of one fine troy ounce of LBMA-standard gold in a Swiss vault. How is this ownership claim structured legally? Who holds the legal title to that gold, and under what jurisdiction or legal framework can a token-holder assert their claim? How does the redemption process work?
LR: Legally, each XAUt token is just an IOU backed by physical gold held by TG Commodities S.A. de C.V. in Switzerland—TG Commodities holds the title to the bars, and token-holders’ right to that gold comes from a contract with Tether Gold under Swiss custodial rules. If you ever want to claim your ounce, you just verify your account with TG Commodities and request redemption; Swiss law (and Tether’s own terms) govern how you prove your entitlement and get the metal shipped.
What we are doing is allowing users on different blockchains to access this system, but the underlying asset remains XAUt. 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 go through the process above directly with TG Commodities S.A
CN: XAUt0 provides “direct ownership of gold, not just price exposure” unlike ETFs or synthetic tokens. Can you clarify this distinction? In practical terms, how does holding XAUt0 differ from holding a share of a gold ETF (e.g. $GLD) or a crypto-backed token like PAXG in terms of legal rights, audits, and risk of loss?
LR: XAUt0 tokens tie you directly to XAUt tokens locked on Ethereum, which then are tied to a specific ounce of LBMA-standard gold in a Swiss vault, and you can redeem that exact bar once you verify your account with TG Commodities.
For audits, XAUt0’s reserves are tracked on-chain and are auditable by everyone. For every XAUt0 in circulation, one XAUt on Ethereum is backing it. Those XAUt tokens are then audited by TG Commodities. XAUt0 is a way to give access to XAUT tokens to a wider audience on their favourite blockchains, I would redirect you to the Tether Gold team for every Legal/Compliance question.
CN: I have seen instances of XAUt0 described as a “stablecoin” even though it’s pegged to gold. How do you classify XAUt0 from a regulatory perspective: are you a commodity token, a security, or a specialized stablecoin? Which financial regulations (e.g. SEC, CFTC, Swiss/French gold laws) apply to XAUt0?
LR: We see XAUt0 as a modern, onchain alternative for storing value amongst the global economic uncertainty that combines the scarcity and inflation-hedging power of physical gold with the accessibility USDt0 provides. XAUt0 is a stablecoin, it is just denominated in ounces of gold rather than in USD. Regulation wise, XAUt0 is not a different token, just the representation of XAUT on a different chain compared to Ethereum. You can imagine this system in the same way as you see other omnichain representations of certain assets.
CN: Have the XAUt0 smart contracts and LayerZero integrations been audited by security firms, and what protections exist against protocol or contract exploits?
LR: LayerZero protocol is specifically designed with multiple fail-safes for potential USDt0 solvency risks, both of which must be breached for a solvency issue to arise: Dual DVN Verification and LayerZero Endpoint Validation. If LayerZero experiences a failure, because USDt0 has a non-custodial design that minimizes external dependencies, USDt0’s reserves remain fully intact and secure on Ethereum. The token’s architecture ensures that no minting or redemption can occur without verified, validated communication. For more information, you can visit USDt0’s Chaos Labs report which recognized USDt0 ‘as a breakthrough in stablecoin infrastructure, assessing it as economically secure with minimal risk exposure.’ You can read more here.
Additionally, despite being built on the already battle tested OFT standard, every single USDT0 or XAUt0 contract has been audited, deployment verified and we maintain the 5th largest bug bounty in the world, which can be found here. The complete of security audits for our token contracts can be found here.
CN: The first deployment of XAUt0 is on TON through Telegram’s Wallet. Why was TON chosen as the launch platform instead of existing DeFi chains? What are the benefits and risks of anchoring a gold token in the Telegram/TON ecosystem?
LR: Choosing TON as the first deployment of XAUt0 was a natural fit. Our teams have a longstanding relationship, and their commitment to permissionless innovation aligns closely with our own.This rollout reflects our shared vision: making programmable, physically backed assets like gold as accessible and seamless to use as any native digital token. You will see more and more chains joining the XAUt0 network soon, with some of them focused mostly on the DeFi aspect.
CN: You’ve said XAUt0 brings a “timeless asset into the decentralized ecosystem”. Looking ahead, do you plan to issue other omnichain tokens for commodities or assets, specifically oil and silver? What is your broader vision for tokenized commodities in DeFi?
LR: As of now, USDt0 is evaluating new chain deployments through three core pillars including: user engagement and ecosystem demand, chains that offer something distinct and unique to the ecosystem, and the potential for growth and long-term value for the Tether ecosystem.
Ultimately, we are focusing on bringing Tether assets to chains that offer the most potential for growth – users, volume, and use cases.
