How secure is USDT on ARB?

Author: Daoshuo Blockchain

1. Why are some very good coins removed from exchanges? ANT is the leader of DAO. I dare not buy altcoins anymore, fearing that Magic will be removed from exchanges.

Now I don’t care too much whether an exchange lists a coin.

In the early years, information was seriously asymmetric. The main source of information for ordinary retail investors to understand a coin was probably the exchange. In that era, the listing of a coin on an exchange may have a strong boosting effect on the price of a coin.

But now, I think this information asymmetry has been weakened a lot, and more and more retail investors get first-hand information through social media.

This source of information is much stronger than the exchange.

And there are already many cases that show that when an exchange lists another coin, the coin has already experienced a considerable wave of fierce increases in the early stage.

So now the listing of a coin on an exchange has an impact on the price of a coin, but it is far less than before.

In addition, the level of coins selected by exchanges now is far worse than before in my opinion. They seem to care more about whether a coin can bring short-term traffic, rather than whether a coin has the potential for long-term development.

If we look at a coin with a longer-term perspective, the most fundamental factor in its long-term trend is its fundamentals and team building. In this way, if its fundamentals are good and the team continues to work hard to build it, those that are not listed will be listed. If the fundamentals are not good and the team building is not strong, it will be abandoned in the end.

Speaking of ANT specifically, I bought this coin a long time ago, but later sold it all. The main reason is that DAO has not improved in recent years, and it seems that there is no direction in the foreseeable future. So it may be too early to talk about this track now.

As for Magic, I still hold it, at least I don’t see any serious problems at present.

2. Is there any problem with holding USDT and USDC on ARB frequently?

I assume that the "whether there is a problem" here refers to "whether it is safe" technically.

If you understand it from this perspective, I think they are definitely not as safe as the USDT and USDC issued on Ethereum.

This is determined by the security of the chain.

ARB is the second-layer extension of Ethereum. In theory, all transactions on ARB must be verified on Ethereum to obtain final confirmation. So if a USDT or USDC transfer is not finally confirmed on Ethereum, then the transfer is theoretically still likely to be rolled back/cancelled.

In addition, ARB's current operation is frankly still very centralized, and its security is actually completely dependent on Ethereum, and it has almost no particularly strong security guarantees.

That is to say, once the team has a big problem (or the sorter has a big problem), the entire chain will be finished. At that time, not to mention the USDT and USDC issued on it, all the assets issued on it will be finished.

This is not only a problem for ARB, but also a problem for almost all Ethereum second-layer extensions at present.

Because of this, the industry's calls for the decentralization of Ethereum's second-layer extensions have always been one after another, and one wave is higher than the other.

Among these second-layer extensions, at present, only Metis is making great strides towards decentralization.

But then again, ARB has been used for so long, and it seems that no one has taken it seriously on these security details. Moreover, USDT and USDC seem to have begun to frequently and widely issue native tokens (non-Ethereum cross-chain) on various second-layer extensions of Ethereum, so it seems that no one cares about the potential security risks of ARB and a number of well-known second-layer extensions.

Whether others care or not, I always think that we should keep an eye on it. Try to use stablecoins issued on Ethereum when using it. For tokens on second-layer extensions, if the security requirements are not so high, you don't have to worry too much about it.