🔧Tethered vs Untethered

EverEarn currently exists on the BNB (Binance Smart Chain) and ETH (Ethereum Mainnet) blockchains, and will soon also exist on the POLY (Polygon Mainnet) blockchain.

Tethered vs Untethered

Multichain cryptocurrency (coins or tokens) fall into two categories; Tethered and untethered. Tethered refers to an explicit link with two or more cryptocurrency across two or more blockchains. The most common form of tethering seen is referred to as Liquidity Tether; this is where two or more crypto have their own total supply on each blockchain, but the liquidity is linked. As the liquidity and marketcap value on one blockchain increases, it also increased the liquidity and marketcap value on another, and vice versa. This tether isn't 100% equal (where both liquidity and marketcap are the exact same amount), as there is always slight variances. The next step up in tethering, is to also tether coin supply; meaning there is a total supply amount that is shared across all the blockchains that the crypto exists on. For instance, a crypto on 3 blockchains with a tethered supply of 1 Million tokens available to be owned, may have that split out as roughly 333,000 tokens existing on each blockchain. In this scenario, crypto holders are commonly able to 'move' their crypto from one blockchain to another without buying and selling, through the contract's ability to burn and mint tokens. In contrast, a crypto on 3 blockchains with an untethered supply of 1 Million tokens available to be owned, will have 1 Million tokens existing on each blockchain. Crypto holders are not able to move their tokens to another blockchain, but the can sell their owned tokens on one blockchain, and buy on another. Whether a crypto is tethered (and to what extent) or not, is entirely subjective as to whether it is a benefit or a risk for a specific cryptocurrency. Within the EverEarn Project, $EARN BNB, $EARN ETH and $EARN POLY are all untethered tokens. The option however to tether the tokens in the future, continues to remain an option.

Untethered for Performance & Security

The EverEarn tokens are currently untethered on each blockchain that they exist. This means that there is no link between $EARN BNB (on BNB chain) and $EARN ETH (on ETH chain), other than that each token belongs to the same project; EverEarn. Each token on each blockchain has its own listing on coin listing sites, and each has its own chart. The purpose of keeping the tokens on each blockchain untethered serves several business critical functions, specific to EverEarn and specific to where EverEarn as a project is currently at presently;

Decreased Negative Contagion Risk

When a negative contagion occurs within the crypto-space (such as a bridge being hacked, an exchange being linked to a scandal, a top alt-coin collapsing, etc), as history has repeatedly shown, more often than not, the negative effects and impact are often limited in regards to the number of blockchains affected. With a tethered token, the negative effect risk is increased because the tether will spread the effect out to tokens on unaffected blockchains. With untethered tokens, the effect is limited to the blockchain being affected. At the present time, given the economic reality and outlook for 2023, EverEarn believes having decreased risk exposure in this area, is the better choice for the project.

Decreased Threat Actor Risk

Crypto users that hold tethered crypto rely upon cross-chain platforms to 'move' their crypto from one blockchain to another. Similarly, crypto projects rely upon these same cross-chain platforms to facilitate the movement of their crypto, in order to be tethered. Unfortunately, these cross-chain platforms ('Bridges') are constantly and repeatedly the focus of threat actors. Hacking a 'bridge', would allow someone to effectively mint (create) as many new crypto-tokens they want and/or steal tokens moving through the bridge; which has occurred on numerous occasions, and continues to occur, even on bridges owned and managed by projects with millions of dollars to put toward security measures. At the present time, EverEarn believe that bridge platform technologies still require more time to mature before they become robust enough to more effectively protect crypto projects from threat actors.

Decreased External Risk Influence

When the markets are down, everyone feels the effect. Downward trends in global economies and increased inflationary pressure within global currency markets can (and do), widely and negatively effect markets of all types; retail, stock, real-estate, crypto, etc. However not all markets are affected equally, and some markets are often able to hold back downward trend pressures better than others, often even doing well. The same holds true for the various crypto blockchains; external negative triggers, events and catalysts may result in the entire crypto-market entering an extended Bear run, but each blockchain will not be affected in the same way. A tethered crypto feels the effect of downward market pressure, not only from each blockchain it is on, but then feels the added impact of spreading that effect out to its other blockchains, through its tether. This increases downward trend pressure for the entire project. Similar to negative contagions noted above, an untethered token feels the effect only so far as each individual blockchain; it does not spread the effect out to its other blockchains. At the present time, EverEarn believes being untethered helps insulate the project against the spreading of downward trends, due to economic negative influences from outside of the crypto-space.