TON and LayerZero: Pioneering Blockchain Interoperability
The Layer-1 blockchain known as TON has announced a strategic partnership with the interoperability protocol LayerZero, aiming to enhance user experience by enabling seamless fund transfers across various blockchain ecosystems. This collaboration is anticipated to increase the utilization and generate revenue for both platforms.
Initially, TON will be integrated with 12 major blockchains, including Ethereum, Tron, and Solana, allowing users to effortlessly transfer stablecoins to TON via Stargate, the largest cryptocurrency bridge currently in operation. According to DefiLlama, Stargate has facilitated an impressive $1.6 billion in transaction volume over the past month.
This integration will also leverage LayerZero’s multichain liquidity feature, which pools funds that are locked in different blockchains. This innovative approach significantly reduces the risk of slippage—defined as the change in price between the initiation and completion of a transaction—or the outright failure of transactions, a common challenge in decentralized finance (DeFi).
Liquidity plays a pivotal role in the DeFi landscape, with a staggering $117 billion in total value locked (TVL) across all blockchain platforms. However, with over 4,400 blockchains and layer-2 networks identified by DefiLlama, liquidity is often fragmented. For instance, if a trading firm aims to lend or borrow substantial sums on a specific chain, the relatively high transaction value can lead to increased chances of slippage or transaction failure. Pooling liquidity effectively mitigates these risks.
Additionally, prominent crypto firms such as Tether and Ethena are set to benefit from this integration. Ethena’s flagship asset, USDe, valued at $5 billion, is poised to launch on TON. Meanwhile, Tether has introduced its new stablecoin, USDT0, designed to address liquidity challenges, which will now be transferable between TON, Tron, Ethereum, Celo, and Arbitrum through its latest product, the Legacy Mesh.
Developers will also find this integration advantageous, as they can deploy tokens on TON from any of LayerZero’s connected chains using a single smart contract, streamlining the development process.
Originally conceived in 2018 as an internal project by the messaging giant Telegram, TON faced a halt in development when Telegram abandoned the initiative two years later. However, in September 2023, Telegram publicly endorsed the now-independent TON, announcing plans to integrate the blockchain into its app’s user interface. Just last month, TON was designated as the exclusive blockchain for Telegram’s mini apps ecosystem.
“TON is undoubtedly one of the most exciting ecosystems today,” stated Bryan Pellegrino, CEO of LayerZero. “After its exclusive partnership with Telegram, it now has access to nearly a billion users.”
