What is the Omnichain Fungible Token (OFT) standard?

The Omnichain Fungible Token (OFT) standard is a technology developed by LayerZero that allows tokens to move seamlessly across different blockchains. Instead of relying on fragmented liquidity pools or complicated wrapping processes, the OFT standard unifies how a token operates, whether it is on the Chiliz Chain, Ethereum, or any other supported network.

When you bridge an asset, the OFT standard processes the transfer in one of two ways, depending on how the token was originally created:

• Burn and Mint: Used for tokens natively built as OFTs (like newer Fan Tokens). When you bridge, the token is burned on your starting chain and an identical, native token is instantly minted on your destination chain. This ensures the total global supply of the token remains exactly the same.
• Lock and Mint: Used for legacy tokens that were originally launched on a single blockchain. The original token is securely locked in a smart contract on the source chain, and a 1:1 backed representation of that token is minted on the destination chain.

Crucially, the OFT standard is strictly non-custodial. This means you retain full ownership of your assets at all times. Neither LayerZero nor Chiliz takes custody of your tokens during the bridge process, and they cannot alter the security settings of the token contracts.