Polygon Lands USDT0 & XAUt0—Get Ready for Faster, Cheaper DeFi & Gold-Backed Finance.

Polygon is stepping up its DeFi game with a major upgrade. On August 27, 2025, the network announced support for native USDT₀ and XAUt₀ the omnichain versions of Tether’s flagship stablecoin and its gold-backed token.

This integration brings several benefits:

• Lower fees and faster transfers

• Deeper liquidity, with over $1.3 billion in USDT migrating to Polygon

• Gold collateral on-chain for the first time, opening new use cases for real-world asset (RWA) finance

With Polygon’s TVL at $1.177 billion and the broader DeFi sector growing 41% year-over-year, this move could help the layer-2 leader tap into the projected $246 billion DeFi TVL by the end of 2025. By combining the stability of USDT with the timeless appeal of gold, Polygon is positioning itself as a hub for asset-backed finance in the digital economy.

Polygon Welcomes Native USDT₀ and XAUt₀ for Faster, Cheaper Liquidity

Polygon has taken a major step forward by integrating USDT₀, Tether’s omnichain standard launched in January 2025. Now live on Polygon as its 12th supported chain, USDT₀ replaces the older bridged PoS version of USDT. According to Polygon’s official blog, the old bridge contract has been disabled, with all flows now routed through the canonical USDT₀ bridge via the Polygon Portal. This upgrade enables near-instant transfers 5-second settlements with 2-second block times all at some of the lowest costs in the industry.

Alongside stablecoins, Polygon has also welcomed XAUt₀, Tether’s gold-backed token, marking the third chain to support it after TON and HyperEVM. Though smaller in size , the addition introduces gold collateral into Polygon’s ecosystem for the first time.Tether highlighted the move in a statement, saying:

“By integrating USDT₀ and XAUt₀, Polygon unlocks fast, frictionless liquidity for DeFi, payments, and new asset-backed use cases.”

On-chain data shows Polygon’s stablecoin market cap at $2.955 billion in late August, up 3.76% in just seven days. With USDT holding 47.58% dominance and USDT₀ bringing over 6 million wallets and enhanced cross-chain rails, liquidity on Polygon is expected to grow even further.

Why Polygon’s USDT₀ and XAUt₀ Upgrade Matters for Users and Developers

The benefits of Polygon’s new integration extend well beyond liquidity headlines they’re reshaping how both developers and everyday users interact with DeFi. For protocols like Aave or QuickSwap, the arrival of USDT₀ means deeper liquidity pools and reduced slippage, making trades smoother and borrowing more efficient. Meanwhile, XAUt₀ introduces something entirely new to Polygon gold-backed collateral. This unlocks strategies such as gold-secured loans, hedging, and yield farming use cases that were previously limited by costly bridging fees.

The numbers tell the story:

• Polygon’s 24-hour DEX volume sits at $143.54 million, with perpetuals at $985,795.

• USDT₀ already commands a $1.6 billion market cap, which Polygon is positioned to tap into within months of launch.

• Gas fees remain under 1 gwei, making transactions dramatically cheaper compared to Ethereum mainnet.

This upgrade is part of a bigger trend. With regulators cracking down on centralised bridges, networks like Polygon are pivoting toward native, compliant solutions under new frameworks such as the GENIUS Act’s stablecoin guidelines. The result is faster, safer, and more cost-efficient DeFi for everyone.

USDT₀ and XAUt₀ Spark RWA Hype

The impact of Polygon’s latest integration is spreading beyond DeFi into the broader world of real-world assets (RWAs) and institutional finance. With gold prices above $2,500 per ounce, the arrival of XAUt₀ lets developers build apps with precious metal backing from tokenised commodities to stable yield products and even gold-collateralised loans.

As experts noted in its analysis, “Polygon’s integration of USDT₀ and XAUt₀ marks a major step in making asset-backed liquidity seamless across the multichain ecosystem.” Together, these tokens now unlock over $3 billion in stablecoin liquidity on Polygon. Market sentiment tilts bullish, with 65% of mentions marked positive. Still, there’s a caveat, while USDT₀ adoption is scaling rapidly, XAUt₀ lags behind with just a $2.5 million market cap a reminder that gold-backed DeFi remains an emerging experiment compared to stablecoins’ explosive growth.

From Stablecoins to Gold-Backed DeFi

Polygon’s journey this year can be tracked through key milestones:

• January 2025 — USDT₀ launches with a $1.6 billion market cap.

• April 2025 — Polygon’s TVL climbs to $1.82 billion.

• July 2025 — The GENIUS Act strengthens stablecoin confidence.

• August 27, 2025 — USDT₀ and XAUt₀ go live on Polygon, with TVL at $1.177 billion (down 1.97% daily, but still up 41% year-over-year with DeFi growth).

Looking ahead, Polygon’s TVL could hit $2.5 billion if overall DeFi TVL doubles, fueled by its 645,739 active addresses and 4.02 million daily transactions. Still, risks remain. Solana’s booming DEX ecosystem threatens to capture liquidity, while a global slowdown could weaken gold demand, limiting XAUt₀’s adoption.

Even so, this integration signals Polygon’s pivot toward institutional-grade tools, blending speed, low cost, and stability. By bringing both stablecoins and gold on-chain, Polygon is positioning itself at the centre of the next wave of omnichain finance. For developers, that means an open door to build innovative apps from gold-collateralised loans to asset-backed DeFi strategies. In short, Polygon may have just lit the fuse on a new digital gold rush.

FAQs

1. What are USDT0 and XAUt0 on Polygon? USDT0 is Tether’s omnichain stablecoin, and XAUt0 is its gold-backed token, now native on Polygon for low-fee, fast DeFi and asset-backed finance.

2. Why did Polygon integrate USDT0 and XAUt0? Announced August 27, 2025, the integration boosts Polygon’s DeFi liquidity with $1.3B in USDT and introduces gold collateral, enhancing RWA use cases.

3. How does this impact Polygon’s ecosystem? Polygon’s TVL, at $1.177B, could grow to $2.5B if DeFi TVL doubles, with USDT0 enabling deeper pools and XAUt0 supporting gold-backed loans.

4. What are the benefits for users and developers? Users get ~5-second settlements and sub-1-gwei fees; developers gain liquidity for Aave, QuickSwap, and innovative gold-backed DeFi apps.

5. What are the risks of this integration? Competition from Solana, regulatory scrutiny on stablecoins, and XAUt0’s low $2.5M cap could limit adoption amid market volatility.