Reeve Collins, one of many authentic architects behind Tether USD (USDT), is backing a brand new yield-bearing stablecoin undertaking referred to as Pi Protocol.
Collins co-founded Tether alongside Brock Pierce and Craig Sellars and served as its first CEO from 2013 to 2015.
In response to a Bloomberg Information report, the decentralized stablecoin will launch within the second half of 2025 and can initially be accessible on Ethereum and Solana.
USP is Pi Protocol’s stablecoin, which is minted utilizing sensible contracts. The stablecoin shall be over-collateralized with belongings reminiscent of US Treasuries, money-market funds, and insurance coverage merchandise.
Collins mentioned in an interview:
“We view Pi Protocol because the evolution of stablecoins. Tether has been extraordinarily profitable in showcasing demand for stablecoins. However they preserve all of the yield. We imagine 10 years later, the market is admittedly able to evolve.”
He added that Pi Protocol goals to capitalize on the increasing stablecoin market and the rising position of real-world belongings in crypto.
Moreover, minting USP will reward customers with one other token, the USI, whose particulars weren’t disclosed.
The undertaking’s official web site additionally mentions USPi, a yield-bearing non-fungible token (NFT). Holders will obtain a share of the platform’s income, which comes from numerous sources, together with yield from stablecoin minting.
USPi holders will even have decision-making energy and can vote on danger parameters, collateral insurance policies, and income distribution. Pi’s group and advisors have been allotted 25% of the governance token provide, with a pre-sale underway.
Significance of yield-bearing stablecoins
Vlad Tenev, CEO of Robinhood, not too long ago warned throughout a Bloomberg TV interview that stablecoins should provide yield-accrual options to compete with different strategies of holding and transacting {dollars}.
He added that though money deposited in banks can accrue a 4% yield in a high-interest surroundings, providing this yield via stablecoins is just not easy.
USDe supplied holders a virtually 30% annual proportion yield (APY), however its dynamic rebalancing decreased the yield to six% as of press time. Ethena Labs’ stablecoin is the third-largest out there, surpassing veteran DAI by roughly $1.5 billion.
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