Why I'm Optimistic About the Stablecoin Field and How to Capture Growth Opportunities in This Market

Stablecoins are showing great potential for development and are expected to become a trillion-dollar market in the future.

A few months ago, the discussion in the cryptocurrency community was still focused on memecoins and celebrity coins, and many people were keen to speculate which coin to invest in next. However, now the focus has quietly shifted. Stablecoins and real world assets (RWA) have become the core topics of industry discussion.

Stablecoins are showing great potential for development and are expected to become a trillion-dollar market in the future. In this article, I will share why I am optimistic about the stablecoin field and explore how to seize the growth opportunities in this market.

Why am I optimistic about stablecoins?

Currently, the stablecoin field is welcoming a series of favorable factors:

* A more friendly regulatory environment

The Trump administration plans to pass stablecoin-related legislation by August, hoping to further consolidate the dollar's global dominance. This will pave the way for the legalization and popularization of stablecoins.

* Traditional financial giants enter the market

Fidelity Investments, which manages $6 trillion in global assets, announced this week that it would launch its own stablecoin. This marks a significant recognition of this field by traditional financial institutions and also injects confidence into the stablecoin market.

* High-yield stablecoin products

Some interest-bearing stablecoins offer attractive annualized yields of 20%-30% through decentralized applications (dApps). These products not only attract crypto investors, but also begin to attract attention from the traditional financial sector.

In addition, the advantages of stablecoins are particularly significant in the field of cross-border payments. The international transfer fees of traditional payment companies are high, but when using stablecoins for payment, these fees are almost negligible. With the gradual implementation of stablecoin-friendly legislation in the United States, its popularity is expected to rise rapidly in the next few years.

How to seize the growth opportunities in the stablecoin market?

* Invest in stablecoin-related protocol tokens

Although mainstream stablecoin issuers such as Circle and Tether have not yet provided direct investment channels to ordinary investors, stablecoin-related protocol tokens are still options worth paying attention to, such as Ethena ($ENA) and MakerDAO/Sky ($MKR). These protocols have attracted billions of dollars in total locked value (TVL) and are expected to benefit from the expansion of the stablecoin market.

However, it should be noted that both tokens have their own problems. Only 34% of $ENA tokens are currently in circulation, and a high inflation rate is expected in the future. MKR has basically stagnated in TVL growth in the past few years and has failed to benefit from the rapid growth of the stablecoin market. Despite this, on-chain data shows that "smart money" with market insight is increasing its holdings of ENA and MKR, indicating that these tokens may have relatively good performance in the future.

In addition, projects such as DeFi project AAVE and decentralized application Pendle may also benefit from the expansion of the stablecoin market. A large part of their TVL comes from stablecoins. If the supply of stablecoins continues to grow, the TVL, revenue and transaction fees of these protocols are also expected to increase simultaneously.

* Participate in airdrops of stablecoin protocols that have not yet launched their tokens

Many emerging stablecoin protocols have launched point reward programs to provide generous rewards to early users. Here are a few protocols worth noting and their strategies:

1. Resolv: A risk-neutral stablecoin with a dual-token model.

Resolv's stablecoin USR and vault token RLP constitute its dual token system. RLP, as the insurance token of USR, provides risk protection while providing users with higher rewards.

Users can convert USDC to USR through the Resolv app and deposit it into the HyperUSD vault. HyperUSD is a new type of vault that automatically optimizes the liquidity deployment of Hyperliquid DeFi. By depositing funds into the HyperUSD vault, users can receive 30x point rewards and additional points from the Hyperliquid ecosystem.

2. Level Finance: An interest-bearing stablecoin that supports DeFi native yields.

Level Finance's stablecoin lvlUSD is backed by USDC and USDT, and these funds are automatically deposited into DeFi protocols such as AAVE to generate yield. Users can start earning yields after pledging lvlUSD to slvlUSD. For example, users can earn 14% annualized yield (APY) and 20x Level points by providing stablecoins to Pendle's slvlUSD liquidity pool.

Level Finance is backed by two well-known crypto venture capital firms, Dragonfly and Polychain, and is likely to issue tokens in the future.

3. Coinshift: An on-chain treasury solution that delivers institutional-grade returns.

Its yield stablecoin csUSDL generates income through US Treasuries and cash equivalents. In just 4 months of listing, the supply of csUSDL