The market capitalization of stablecoins has surpassed $205 billion, and USDT's dominant position is gradually declining.

Recently, the stablecoin market has continued to expand, with a total market capitalization exceeding 205 billion USD. Although the long-established stablecoin USDT still holds a dominant position, its market share is gradually declining. This article will provide a comprehensive overview of the current diversified stablecoin ecosystem.

![\Stable Dog Original] The total market capitalization of stablecoins exceeds 205 billion USD, USDT's market share continues to decline, and this article explains the diversification of stablecoins

Traditional Stablecoins

USDT (Tether)

• Issuer: Tether
• Launch date: 2014
• Value pegging: Pegged to the US dollar at a 1:1 ratio, backed by reserve assets.
• Market Position: One of the earliest and largest trading stablecoins in the world.
• Controversy: The issue of reserve transparency has always been a point of contention.

USDC (USD Coin)

• Issuer: Circle and Coinbase co-founded
• Launch date: 2018
• Features: Strong compliance, high transparency of reserve assets
• Market Position: Second largest stablecoin, highly favored by institutional users

FDUSD (First Digital USD)

• Issuer: First Digital Labs
• Launch Date: 2023
• Pegging mechanism: 100% USD or equivalent cash equivalents as reserves
• Blockchain Support: Compatible with Ethereum and Binance Smart Chain

DAI

• Issuer: MakerDAO
• Launch date: 2017
• Features: decentralized, over-collateralized stablecoin
• Operating network: Ethereum and other EVM-compatible blockchains
• Status: Currently the highest market capitalization algorithm stablecoin

![\Wagyu Original] The total market capitalization of stablecoins exceeds 205 billion USD, and USDT's market share continues to decline. Understand the diversification of stablecoins in one article

New Stablecoin

New types of stablecoins not only maintain price stability but also provide additional investment returns for holders. Key features include:

1. Provide returns through low-risk asset investments, staking, or structured financial strategies.
2. Use government bonds and other assets as collateral to maintain price stability and high liquidity.
3. Combine on-chain assets with off-chain financial products.

1. USDe

• Developer: Ethena Labs
• Features: Maintains a 1:1 peg to the USD through a Delta neutral strategy.
• Sources of income: staking rewards, funding rates, and basis income
• Current yield: approximately 8.64%

![\Stable Dog Original] The total market capitalization of stablecoins exceeds 205 billion USD, and USDT's market share continues to decline. Understand the diversity of stablecoins in one article. (https://img-cdn.gateio.im/webp-social/moments-3e77d26186398f8b8664db9dc062e72b.webp)

2. USD0

• Issuer: Usual Protocol
• Features: Issued 1:1 with RWA assets as reserves
• Mechanism: Users deposit assets to obtain LDT representing the initial value of the deposit.

3. Sky Dollar (USDS)

• Issuer: The original MakerDAO( has been renamed to Sky)
• Features: Can be exchanged 1:1 with DAI, SKY serves as the new governance token.

4. USDD

• Issuer: TRON联合储备(TRON DAO Reserve)
• Features: Over-collateralized endorsement of various mainstream digital assets

5. BlackRock USD (BUIDL)

• Issuer: BlackRock (
• Features: Invest in cash, US Treasury bonds, and repurchase agreements, etc.
• Yield: currently about 4.5%, similar to the yield on short-term US government bonds.

) 6. Ondo US Dollar Yield ###USDY(

• Issuer: Ondo Finance
• Mechanism: Supported by short-term US Treasury bonds and bank demand deposits.
• Yield: As of January 23, 2024, the APY is 4.65%

) 7. USDX Money ###USDX(

• Issuer: Stables Labs
• Features: Achieve profits through multi-currency arbitrage and perpetual contract hedging mechanisms.

) 8. Frax ###FRAX(

• Issuer: Frax Finance
• Mechanism: Combination of partial collateral and algorithmic mechanisms
• Sources of income: interest income, liquidity mining, governance token FXS
• Current yield: approximately 10%

) 9. Resolv USD ###USR(

• Features: Use ETH and derivatives as collateral to protect assets through hedging operations.
• Source of income: ETH staking rewards and hedging operation spreads

) 10. M By M⁰ ###M(

• Features: Decentralized stablecoin protocol that allows users to earn yield from collateral.
• Mechanism: Mint M tokens through off-chain collateral ) such as treasury bonds (.

) 11. yala

• Features: stablecoin protocol based on the Bitcoin ecosystem
• Mechanism: Users deposit BTC to lend stablecoin $YU, and can participate in DeFi products to earn returns.

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Stablecoin Market Outlook

The stablecoin market has enormous potential and is the cornerstone of DeFi and future payment finance. In the short term, fiat-backed stablecoins like USDT and USDC will continue to dominate. New types of stablecoins are mainly divided into two categories: one is backed by traditional financial assets, which have relatively stable returns; the other maintains stability through arbitrage, but there are issues related to transparency and security.

Investors should pay attention to emerging stablecoin protocols to seize airdrop and staking reward opportunities, but they should be cautious about the risks of platform tokens. In the future, the stablecoin ecosystem will become more diversified and further integrated with traditional finance, providing users with richer choices.

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