TL;DR
- Mountain Protocol has integrated Chainlink CCIP to enable secure transfers of its USDM stablecoin across multiple blockchains.
- Chainlink CCIP employs a token burning and minting process, where tokens are burned on the origin blockchain and minted on the destination blockchain.
- The stablecoin continues to gain relevance, as it was included in Ethena’s $46.6 million real-world asset reserve fund.
Mountain Protocol has integrated its USDM stablecoin with Chainlink CCIP (Cross-Chain Interoperability Protocol), a platform designed to enhance interoperability between multiple blockchains. This integration aims to facilitate the transfer of tokens across chains like Ethereum, Arbitrum, Polygon POS, Optimism, and Base, improving security and usability in the process.
The operation of Chainlink CCIP in this integration is based on a token burning and minting system. When a user wishes to transfer tokens from one blockchain to another, the tokens are burned on the origin chain and minted again on the destination chain. This process is supervised by independent Chainlink nodes, which ensure the secure and accurate transmission of events between blockchains. In this way, USDM supply consistency is maintained, preserving transaction integrity and fund security.
Mountain Protocol launches USDM cross-chain native bridging with @chainlink's CCIP, simplifying transfers and unifying liquidity across multiple blockchains while ensuring security.
You can now move your USDM across chains via https://t.co/KBqYH5C2dx or via @xswap_link's app.… pic.twitter.com/X1Kx0ctp6k
— Mountain Protocol (@MountainUSDM) October 17, 2024
The integration of Chainlink CCIP also brings additional benefits for USDM users, especially in the DeFi sector. By eliminating the need for complex bridging solutions for cross-chain transfers, friction in operations is reduced, and the user experience is improved by simplifying the token movement process. Additionally, the availability of USDM on multiple blockchains opens up new opportunities to enhance liquidity, which could encourage participation in various platforms and expand the scope of DeFi activities.
Ethena Includes USDM in its RWA Fund
While this expansion is highly significant for Mountain Protocol, Chainlink’s native token, LINK, has not been able to capitalize on the recent CCIP integrations with various projects. LINK has shown a bearish trend in the market, with indicators suggesting the possibility of a “death cross,” a technical phenomenon pointing to greater downward pressure on its price. However, LINK accumulation by hodlers could offer a sign of long-term optimism.
On the other hand, USDM continues to consolidate as an attractive option among stablecoins. Recently, Ethena included USDM among the assets of its $46.6 million real-world asset (RWA) reserve fund, highlighting the growing interest in this regulated stablecoin, backed by U.S. Treasury bonds, and offering a 5% annual yield
