The $500 million financing was sold out in an instant. How will Plasma, backed by Tether, build the Bitcoin financial settlement layer?

Author: Sam , Messari Analyst

Compiled by: Tim, PANews

PANews Editor's Note: With Circle's successful IPO and outstanding listing performance, the market's attention to stablecoins has gradually increased. Plasma, a stablecoin chain supported by Tether, completed its IC0 last night, and the $500 million quota was "snatched up" within minutes. Plasma's main label is stablecoin, but the market knows little about its technical architecture and functional characteristics. This will help everyone fill this "cognitive gap".

Previously, PANews wrote an article about Plasma : Building a blockchain exclusively for stablecoins, what is the difference between Plasma, which has raised over $24 million? for readers to read together.

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Sneak Peek

Plasma is not just a stablecoin chain, it is also a Bitcoin sidechain and a privacy solution.
Tether is likely to launch native USDT on the Plasma chain to achieve low-slippage Bitcoin exchange and trust-minimized Bitcoin-collateralized stablecoin lending, which will be the key to unlocking new demand for BTCFi.
Similar to the Circle payment network, Plasma serves as a payment network for banking partners and custodians, providing support for USDT's fiat currency withdrawal channel.

Plasma is often simplified as a "stablecoin chain." This understanding is correct, but it misses the point. What Plasma really builds is a financial infrastructure layer built specifically for Bitcoin. It not only supports stablecoins, but also regards them as the underlying foundation. It is a Bitcoin sidechain that provides native USDT support, protocol-level privacy protection, and its Gas model does not require users to hold volatile governance tokens. This is not just about payment functions, but about building a settlement layer denominated in US dollars that natively supports Bitcoin.

The project is supported by Tether and Bitfinex owned by Peter Thiel and Paolo Ardoino, and integrates three emerging technology trends: Bitcoin Rollup technology, stablecoin infrastructure and on-chain privacy protection. Each concept has investment value in itself, and the combination of the three is more likely to build the most valuable financial infrastructure layer in the Bitcoin ecosystem.

Plasma is a Bitcoin sidechain, not limited to stablecoin applications

Plasma's architecture uses Bitcoin as its final settlement layer. The chain performs L2 and sidechain-like functions, alleviating trust reliance assumptions by regularly anchoring state commitments to the Bitcoin blockchain and inheriting Bitcoin's security model.

Plasma chain technology is likely to lead the new wave of BTCFi because it unlocks the functions that users really want: exchanging large amounts of Bitcoin with extremely low slippage, and directly pledging native Bitcoin to borrow stablecoins. This seemingly basic demand actually requires two core supports: deep liquidity (supported by Tether) and trust minimization mechanism (supported by BitVM2).

With Tether's direct endorsement, Plasma has access to one of the deepest liquidity pools in the crypto world. The platform is very likely to natively support USDT, an advantage that makes it an advantage over Bitcoin sidechains that rely on cross-chain stablecoins or new native stablecoins. It will essentially become the core settlement layer for BTC/USDT transactions, which is a function that the current Bitcoin mainnet itself does not have.

Unlike other Layer 2 and sidechains that require Bitcoin packaging or hosting bridges, Plasma has built a dedicated Bitcoin cross-chain bridge that operates through a permissionless validator mechanism and promises to adopt this solution after BitVM2 goes online. This will achieve more seamless user access while effectively reducing counterparty risk.

Built-in privacy features

Privacy protection is directly integrated into Plasma's transaction model. Users can choose to join the shielded transfer function, which can hide the information of the two parties and the amount of the transaction without sacrificing interoperability and user experience. Unlike ZK privacy solutions (such as ZCash and Aztec) that require special tools or browser extensions, Plasma's privacy model can achieve application layer compatibility, and by introducing basic account abstraction elements, its user experience is closer to banking services rather than another EVM chain.

The design supports selective disclosure, enabling users to prove specific transaction details when needed (for example, to exchanges, auditors, or compliance platforms) without exposing all on-chain activities. This privacy system ensures individual control while achieving interoperability with regulatory frameworks.

The key is that Plasma technology allows users to trade without holding or using volatile native tokens. Gas fees can be paid directly in USDT or BTC, and these payments are automatically exchanged through oracle mechanisms or internal pricing systems. This design not only simplifies the user experience, but also eliminates the transaction traceability risks caused by purchasing and consuming native tokens, making Plasma an ideal choice for users who pursue low-friction, low-profile financial operations, while maintaining excellent usability while achieving privacy protection.

Stablecoin perspective

The key point to understand is that Plasma represents the most direct investment in Tether. Traditionally, Tether is just a liquidity layer for various platforms, while Plasma is positioned as a vertically integrated execution environment, where USDT is no longer just one of many assets, but exists as a native component of the chain.

This brings two potential value-added spaces. The first is market-driven. As the demand for stablecoins grows (especially global users seeking exposure to the US dollar), USDT-based products may gain a strong fundamental pull. In addition, Circle's IPO has refocused the market on stablecoins, and assets linked to Tether's infrastructure are expected to benefit from the rising market heat.

The second point is the structural advantage. Plasma is able to connect financial institutions to compliant global payment systems. This is similar to the Circle payment network, but serves the Tether ecosystem. The system will have full anti-money laundering capabilities to support corporate onboarding, and will enable fiat currency exchange channels through integration with banking partners and custodians, while still supporting permissionless DeFi applications. With near-real-time and low-cost international settlement capabilities, Plasma can compete with traditional banking networks. Considering that USDT's circulation is nearly 2.5 times that of USDC, and depending on the valuation of the Circle payment network, I believe that the institutional demand brought by the payment network function alone is sufficient to support a fully diluted valuation (FDV) of US$500 million.

Plasma, a financial layer built on Bitcoin, with Tether providing launch liquidity and enhanced by native privacy features, is able to achieve goals that other cryptocurrency projects cannot achieve.