The Rise of Yield Stablecoins: Diversified Income Strategies Leading a New Trend in Cryptocurrency Investment

Yield Stablecoin: A New Earning Engine for Crypto Investors

In the cryptocurrency market, stablecoins are quietly evolving. They are no longer just a tool for preserving value, but are beginning to generate income for holders. From U.S. Treasury bonds to perpetual contract arbitrage, interest-bearing stablecoins are becoming a new source of income for investors. Currently, there are dozens of related projects with a market capitalization exceeding $20 million, with a total value of over $10 billion. This article will delve into the sources of income for mainstream interest-bearing stablecoins and highlight the most representative projects in the market.

Overview of Yield Stablecoin Track: Which Projects are Helping Your Money Make Money?

Definition and Characteristics of Interest-bearing Stablecoins

Yield stablecoins differ from traditional stablecoins in that they not only maintain price stability but also provide passive income to holders. Their core value lies in generating additional returns for users through underlying strategies while maintaining price anchoring.

Diversification of Revenue Sources

The sources of income for yield stablecoins mainly include:

  1. Real World Asset (RWA) investment: Invest in low-risk assets such as US Treasury bonds, money market funds, or corporate bonds.

  2. DeFi Strategy: Participate in decentralized finance liquidity pools, liquidity mining, or adopt delta-neutral strategies.

  3. Lending: Lending deposits to borrowers to earn interest income.

  4. Debt Support: Users can lock up encryption assets as collateral to borrow stablecoins, with returns coming from stability fees or collateral interest.

  5. Mixed Sources: Combining various channels such as tokenized RWA, DeFi protocols, and centralized financial platforms.

Market Structure Analysis

The following is an overview of the current mainstream yield-generating stablecoin projects, categorized by their main yield generation strategies:

1. RWA supported type

This type of stablecoin primarily generates returns by investing in low-risk physical assets:

  • USDtb (Supply of 1.3 billion USD): Supported by a well-known asset management company.
  • USD0 ($619 million): backed 1:1 by short-term RWA.
  • BUIDL ($570 million): Holding U.S. Treasury bonds and cash equivalents.
  • USDY (560 million USD): Fully backed by U.S. Treasury bonds.
  • USDO ($280 million): The revenue comes from U.S. Treasury bonds and repurchase agreements.
  • USDz ($122.8 million): backed by a diversified tokenized RWA portfolio.
  • USDN ($106.9 million): backed by 103% U.S. Treasury bonds.
  • USDL (94 million USD): backed by U.S. Treasury bonds and cash equivalents, with daily automatic compounding.
  • AUSD ($89 million): backed by US dollars and cash equivalents.
  • cgUSD ($70.9 million): backed by short-term government bonds, with daily automatic balance adjustments reflecting earnings.
  • frxUSD ($62.9 million): A multi-chain stablecoin backed by a well-known asset management company.

2. Basis Trading/Arbitrage Strategy Type

This type of stablecoin generates returns through market-neutral strategies:

  • USDe ($6 billion): Maintained peg through spot collateral delta hedging.
  • USDX ($671 million): Utilizes delta neutral arbitrage strategies among various cryptocurrencies.
  • USDf ($573 million): Generates profits through market-neutral strategies such as funding rate arbitrage and cross-platform trading.
  • USR ($216 million): Supported by ETH collateral pool, hedging risks through perpetual futures.
  • deUSD ($172 million): Using stETH and sDAI as collateral, a delta-neutral position is created by shorting ETH.
  • USDF ($110 million): backed by encryption assets and corresponding short futures.
  • xUSD/xUSDT ($65 million): Earn profits through market-neutral arbitrage on centralized trading platforms.
  • yUSD ($23 million): Earnings come from delta-neutral strategies, lending platforms, and yield trading protocols.
  • USDh ($5.5 million): Bitcoin support through delta hedging, earning funding fees.

3. Lending/Debt Support Type

This type of stablecoin generates returns through lending or collateralized debt positions:

  • DAI ($5.3 billion): Minted through collateralized debt positions by collateralizing various assets.
  • crvUSD ($840 million): Over-collateralized stablecoin, backed by ETH and managed through specific mechanisms.
  • syrupUSDC (631 million USD): Backed by fixed-rate collateralized loans provided to institutions.
  • MIM ($241 million): Minted by locking interest-generating encryption coins, with earnings coming from interest and liquidation fees.
  • GHO ($251 million): Minted through collateral provided in specific lending markets.
  • DOLA ($200 million): Minted through collateralized lending, with returns coming from lending income.
  • lvlUSD ($184 million): Supported by stablecoins deposited in DeFi lending protocols.
  • NECT ($169 million): Native CDP stablecoin, with yields from multiple sources.
  • USDa ($193 million): Minted using assets like BTC through the CeDeFi CDP model.
  • BOLD ($95 million): Backed by over-collateralized ETH, the returns come from interest and liquidation.
  • lisUSD ($62.9 million): Minted through the use of multiple assets as collateral in a CDP.
  • fxUSD ($65 million): Minted through leveraged positions backed by stETH or WBTC.
  • BUCK ($72 million): Over-collateralized CDP supporting stablecoin based on specific network.
  • feUSD ($71 million): A CDP stablecoin minted using specific assets as collateral.
  • superUSDC (51 million USD): Automatically rebalances across multiple networks in top lending protocols.
  • USD3 ($49 million): Backed 1:1 by a basket of blue-chip income-generating tokens.

4. Mixed Revenue Source Type

This type of stablecoin diversifies risks and optimizes returns by combining multiple strategies:

  • rUSD ($230.5 million): Supported by a combination of RWA and dollar-based capital allocators and lending vaults.
  • csUSDL ($126.6 million): Backed by government bonds and DeFi lending, it offers regulated low-risk returns.
  • Multiple Midas products ($110 million): Represents claims on actively managed interest-bearing RWA and DeFi strategies.
  • upUSDC ($32.8 million): Revenue comes from lending strategies, liquidity provision, and staking.
  • USD* ($19.9 million): A specific network-native interest-bearing stablecoin that earns returns in various ways.

Risk Warning

Although interest-bearing stablecoins offer attractive returns, investors should be aware that these products are not without risks. They may face various challenges such as smart contract risks, protocol risks, market risks, or collateral risks. Before investing, it is essential to fully understand the associated risks and make informed decisions based on individual risk tolerance.

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MysteriousZhangvip
· 07-09 20:23
Let's study it together.
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StakeOrRegretvip
· 07-09 15:11
Risk and return coexist
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ConsensusDissentervip
· 07-09 15:06
Looking forward to the next bull run
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AirdropATMvip
· 07-09 15:06
The earnings can be very sweet.
View OriginalReply0
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