The Rise of Interest-Generating Stablecoins

Yield-bearing stablecoins are showing a vigorous development trend. This can be seen from various metrics tracked by stablewatch: the total market capitalization of yield-bearing stablecoins, the number of such products launched in the past few months, and the total earnings paid to users.

Let us analyze this data in depth.

1, Interest-earning stablecoin market capitalization

In less than two years, the total supply of interest-bearing stablecoins has grown 13 times, from $666 million in August 2023 to $8.98 billion in May 2025. It reached a historical peak of $10.8 billion in February this year and has since stabilized:

Compared to payment-oriented stablecoins, yield-oriented stablecoins currently only account for a small portion of the entire stablecoin market (3.7%) (as of now, the market capitalization of yield-oriented stablecoins is $8.98 billion out of a total market capitalization of $242.47 billion):

2. How many types of existing interest-bearing stablecoins are there?

Currently, we are tracking over 30 types of interest-bearing stablecoins on stablewatch, but there are actually more than 100 types on the list, and the continuously added varieties are overwhelming. It is important to note that there is no widely accepted definition of interest-bearing stablecoins, so the statistics depend on the classification criteria (see details later). The figure below shows the market capitalization distribution of various interest-bearing stablecoins:

Clearly, the number of interest-bearing stablecoins is growing rapidly, and many newly launched interest-bearing stablecoins are currently gaining market attention. Let's take another look at the same chart (excluding the top six interest-bearing stablecoins by market capitalization and focusing the time range on the last 12 months):

As expected, sUSDE issued by Ethena and the pioneers in this field, Sky (sUSDS and sDAI), dominate the market, with these assets accounting for 57% of the total market capitalization of interest-bearing stablecoins (approximately $5.13 billion):

3. Yield Payment (YPO)

Since the middle of 2023, interest-bearing stablecoins have paid out nearly $600 million in earnings:

It should be noted that the YPO indicator, pioneered by stablewatch, is still in its early stages and has not yet tracked the multiple correlations between interest-bearing stablecoins. Nevertheless, this indicator provides a valuable overview for assessing the importance of interest-bearing stablecoins as an asset class.

4. What exactly is an interest-bearing stablecoin?

Currently, there is no unified definition for yield-bearing stablecoins in the industry. As I mentioned earlier in other related articles, this is an extremely broad and diverse category that includes tokenized yield strategies, hedge fund-like structures, simple asset (such as government bonds) wrapping tools, yield-bearing lending certificates, multi-strategy yield aggregators, and more. Possible classification dimensions include:

• Sources of income
• Earnings Distribution Mechanism
• Pegging Maintenance Mechanism
• Reserve Asset Type
• Custody arrangement
• Regulatory Status
• Liquidity characteristics and redemption channels and frequency
• Governance model
• Risk concentration
• Target user group
• Underlying infrastructure (blockchain) support, etc.

This emerging phenomenon requires further research for clarification. Even if future interest-bearing stablecoins may be deconstructed into multiple clearer subcategories, an in-depth analysis of their economic models, technical architectures, and applicable rules will help users make more informed decisions and maintain market integrity.