The Second Half of the Stablecoin Race: Regulation, Compliance, and Innovation

The stablecoin industry is transitioning from a phase of reckless growth to a more regulated development period. Future development will be shaped by three key factors: the clarification of regulatory frameworks, the compliance processes of leading companies, and the evolution of market innovation directions.

The global regulatory environment is transitioning from ambiguity to clarity. Regulatory frameworks such as Europe's MiCA and the United States' GENIUS Act have set a clear development direction for the industry. Against this backdrop of regulatory certainty, a well-known stablecoin company recently went public, with its stock price soaring nearly 170% on the first day. This not only marks a step towards the mainstreaming of the stablecoin industry but also provides an important reference for traditional capital in assessing the market value of stablecoins.

On this basis, the development of stablecoins has already surpassed the simple function of being pegged to the US dollar. Future development trends may focus on three aspects: 1) innovation of decentralized financial protocols related to stablecoins, 2) widespread application of stablecoin payment tools, and 3) deep integration with real-world assets.

Three Major Use Cases of Stablecoins

payment field

Traditional cross-border payment systems are inefficient, costly, and opaque, making it difficult to meet the demands of the digital age. Stablecoins, with their near-zero cost, 24/7 availability, and programmable features, are revolutionizing traditional payment systems. Many mainstream payment companies and financial networks have begun integrating stablecoins, validating their immense potential in the business sector. Stablecoins are rapidly evolving from a pricing tool in cryptocurrency exchanges to a global medium for payment and settlement.

Decentralized Finance ( DeFi )

Mainstream stablecoins have significant capital efficiency issues. The stablecoins held by users are usually non-interest bearing, while the issuers obtain all interest income by investing reserve assets. This model effectively turns users into uncompensated capital providers. Unlike traditional stablecoins, emerging yield-bearing stablecoins directly embed income mechanisms such as U.S. Treasury bonds, DeFi lending, and arbitrage into the token design, allowing holders to automatically earn yields.

Real World Assets ( RWA )

RWA tokenization is widely seen as the core driving force behind propelling DeFi into the next trillion-dollar scale. At its core, it involves bringing real-world assets with stable cash flows (especially U.S. Treasury bonds) onto the blockchain, providing DeFi with sustainable, low-risk "real yields" and attracting institutional-grade capital participation. RWA injects "value" and "scale" into stablecoins, opening up the possibility of a trillion-dollar market for stablecoins.

Top 10 Potential Stablecoin Projects

1. Plasma: A high-performance blockchain designed for stablecoins, addressing issues such as high transaction fees and transaction failure rates encountered by traditional chains when processing stablecoins.

2. Noble: The stablecoin USDN, based on the M^0 architecture, is collateralized by short-term US Treasury bonds, with an expected annualized return of approximately 4.31%.

3. OpenEden: An institution providing on-chain US Treasury bond yield products, issuing TBILL tokens and yield-generating stablecoin USDO.

4. Cap: Issuing two products, cUSD and stcUSD, with the latter generating returns through a decentralized operator network.

5. Coinshift: An on-chain financial management platform for institutions and teams, issuing two stablecoins, csUSDL and csUSDC.

6. AUSD: A stablecoin fully collateralized by cash, U.S. Treasury bonds, and repurchase agreements, supporting Compliance features.

7. Perena: A stablecoin infrastructure protocol built on Solana that issues yield-bearing stablecoin USD*.

8. Level: The issuance of lvlUSD is fully backed by USDC and USDT, generating low-risk returns by being deployed to blue-chip lending protocols.

9. Falcon: Offers the USDf stablecoin with two minting mechanisms, Classic Mint and Innovative Mint.

10. Yala: A liquidity protocol native to Bitcoin that allows users to mint over-collateralized stablecoins YU by staking BTC.

The second half of the competition for stablecoins has surpassed the simple dollar-pegged functionality. From Bitcoin sidechains designed specifically for stablecoins to yield-bearing stablecoins, these innovative projects have the potential to redefine the stablecoin market in the future.