In recent years, financial investment returns have been sluggish, stablecoins may become a new option.

In the past two years, the yields of traditional financial products have continued to decline, causing many investors to feel troubled. Bank deposit interest rates are almost negligible, returns on government bonds and money market funds are even struggling to outpace inflation, and the yields on insurance financial products are quietly decreasing. For investors hoping to achieve asset appreciation, facing the generally around 1% yield in financial management applications, it is inevitable to feel frustrated.

Although we seem to live in an era with an unprecedented variety of financial products, investment methods that can generate stable profits are becoming increasingly rare. Against this backdrop, a financial management method originating from the cryptocurrency sector—especially blockchain wealth management based on stablecoins—has begun to attract the attention of more and more people.

Why Stablecoin Wealth Management is Worth Paying Attention To?

Stablecoins are digital assets that are pegged to fiat currencies. Unlike Bitcoin, which experiences significant price volatility, stablecoins play more of a "digital cash" role. Stablecoin investment, in simple terms, allows users to lend, stake, or invest idle stablecoins on the blockchain or centralized platforms to earn corresponding annual returns.

Although this model sounds novel, its principle is not complex — it is similar to banks earning interest rate spreads by using deposits for lending. The difference is that in the blockchain world, this "spread" is more transparent, and the distribution of profits is more reasonable. Currently, common stablecoin financial products can be roughly divided into the following categories: lending, staking, liquidity mining, and fixed income.

According to data from the first half of this year, the annualized interest rates of USDT/USDC in mainstream decentralized finance (DeFi) lending protocols mostly fluctuate between 2.5% and 4%. Some DeFi platforms offer total annualized yields that may exceed 8% through liquidity mining or reward mechanisms, but this often comes with higher volatility and lock-up requirements. In contrast, fixed-income products, although not offering the highest annualized returns, have shown stable performance with an overall upward trend, reaching up to around 5%. Coupled with advantages such as stable returns and lower entry thresholds, they have become the preferred choice for many users in blockchain wealth management.

What’s more noteworthy is that the flexibility and user experience of these products are rapidly being optimized. Users only need to hold stablecoins and then choose the platform and product type to subscribe with one click. Some platforms also support on-demand deposits and withdrawals, with interest calculated daily. This operation method is as convenient as Yu'ebao, yet it can yield interest close to that of U.S. Treasury bonds; it is as stable as a fixed deposit but without penalties for early redemption. This "stability with flexibility" experience is exactly the ideal financial management state for many users.

Advantages of Stablecoin Wealth Management

Compared to fixed-income products in traditional financial markets, stablecoin wealth management has the following obvious advantages:

1. Higher yield: Annual returns generally range from 3% to 5%, with some products even higher.
2. Flexible redemption mechanism: Most products support on-demand deposits and withdrawals, with interest calculated daily, without the need for lock-up or setting a yield period.
3. Higher transparency: Many platforms publicly disclose sources of revenue, risk explanations, and the flow of funds, some even verify the security of funds in real-time through blockchain data.
4. Reasonable profit distribution: The platform no longer "eats the interest spread" but instead distributes the actual lending or matching profits proportionally to the investors, reflecting the blockchain financial system's concept of "value returning to users."

The Source of Income from Stablecoin Wealth Management

The returns from stablecoin wealth management mainly come from three aspects:

1. Lending interest on the blockchain: The platform lends the stablecoins locked by users to other users to generate profits.
2. Staking rewards or node income: Commonly seen in Staking-type products.
3. Profit distribution for participating in options or yield tiering strategies.

For users, as long as the platform's product structure is open and transparent, and asset custody is secure, these can be regarded as "quasi-fixed income products" on the blockchain.

Currently, the number of active addresses for stablecoins on the blockchain continues to grow. Although there are no specific statistics on the number of users participating in stablecoin financial management, the scale is rapidly expanding based on blockchain activity and capital inflow. Especially in regions like Southeast Asia, Latin America, and the Middle East, where local currencies are unstable and financial system coverage is insufficient, stablecoins have become an important tool for residents to avoid local currency devaluation and obtain returns on dollar-denominated assets.

It is worth noting that institutional funds are also continuously entering this field. Insurance companies, family offices, and funds have incorporated stablecoin wealth management into their liquidity management tools, as part of the dollar asset pool. This trend is driving platforms to continuously upgrade in terms of risk control, transparency, and compliance, providing individual users with a more mature product environment and service experience.

Risks and Suggestions for Stablecoin Financial Management

Despite the many advantages of stablecoin wealth management, risk identification remains crucial in this emerging field. Some stablecoins may face de-pegging risks due to issues such as liquidation mechanisms and management of pegged assets, as evidenced by fluctuations seen in TUSD, USDD, and others. Factors such as smart contract audits and security measures can also impact the safety of funds.

Therefore, for ordinary users, it is recommended to choose top platforms or products from regulated institutions, with a priority on stablecoin financial products that have clear return structures and support flexible redemptions. Caution should be exercised with products that offer annualized returns exceeding 10%, and one should avoid blindly pursuing high returns. Stability, transparency, and compliance should be the primary considerations for long-term participation.

In the current environment of generally low interest rates, stablecoin wealth management provides investors with a new and robust investment option. While there is no need to fully embrace the entire cryptocurrency world, through stablecoins, investors can possess a transparent, secure, "digital savings account" with an annual yield of around 5%. In a financial market filled with uncertainty, this may be a source of reliable returns worth exploring.