USDT Migration Guide

USDT Migration on Sei: KavaUSDT to USDT0

Overview

On Sei Mainnet, there are currently two types of USDT:

• KavaUSDT: Bridged via IBC from the Kava blockchain.

• USDT0: 1:1 backed by Ethereum-native USDT, bridged via LayerZero’s OFT standard.

Both are usable today, but USDT0 is becoming the new standard across the Sei DeFi ecosystem.

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Understanding the Difference

Feature	USDT0	KavaUSDT
Origin	Ethereum-native USDT	Bridge from Kava
Bridging Method	LayerZero OFT (Omnichain Fungible Token)	IBC
Backing	1:1 backed by locked USDT on Ethereum	Backed by KavaUSDT in a Kava smart contract
Cross-Chain Support	Seamless via LayerZero	Limited to IBC-compatible chains
Ecosystem Preference	Preferred	Deprecated
Redeemability	Backed by USDT on Ethereum. Supported by native USDT on Tron, TON, Arbitrum, etc.	Supported by native USDT on Kava.

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Why migrate to USDT0?

Protocols on Sei (including Yei Finance) are adopting USDT0 as the primary stablecoin because of its:

• Direct backing by Ethereum USDT.

• Native compatibility with omnichain transfers (via LayerZero).

• Stronger oracle and tooling support.

• Simpler and safer app integrations.

• Future-proof ecosystem compatibility.

USDT0 will be the default stablecoin on Sei, offering better native liquidity and security. As Sei transitions to EVM-only, KavaUSDT will no longer be supported.

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How to migrate?

You can migrate to USDT0 using the following three methods:

Method 1 - YeiSwap

Swap on YeiSwap.

Visit YeiSwap to convert KavaUSDT into USDT0.

Method 2 - YeiBridge

Use YeiBridge to migrate.

Visit YeiBridge to send your KavaUSDT to another chain (such as Avalanche, Arbitrum) as USDT.

Bridge the USDT back to Sei as USDT0.

Make sure you have enough assets (such as AVAX or ETH) on the destination chain to cover transaction fees.

Method 3 - Kava Bridge

This method is better for large amounts and offers zero slippage from Sei to Kava EVM (as of July 24, 2025). It leverages Kava but requires additional setup, such as configuring a Keplr wallet.

Use Kava Bridge to bridge out.

Visit Kava Bridge, and bridge KavaUSDT from Sei to Kava EVM.

Wait for the bridge process to complete.

Check your destination wallet to ensure the USDT has arrived.

Transfer USDT to a CEX (e.g., Binance, Bybit, etc.).

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Frequently Asked Questions

Q: Do I have to migrate?

A: Migration is strongly recommended. As Sei transitions to an EVM-only architecture, KavaUSDT will have fewer use cases and reduced support across the ecosystem. Additionally, Yei will cease supporting deposits and borrowing for KavaUSDT after Jul 10, 2025.

Q: Is KavaUSDT going away?

A: Once Sei completes the SIP-3 transition, Cosmos-native assets will no longer be supported. For more details, see: https://blog.sei.io/sip-3-update-sei-moves-toward-evm-only-architecture.

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Summary

USDT0 is the official stablecoin standard on Sei.

Migrating ensures access to better DeFi opportunities, cross-chain compatibility, and ecosystem-wide support.

For the best experience and compatibility, use USDT0 going forward.