Tether Co-Founder Reeve Collins Launches Pi Protocol to Issue Yield-Bearing Stablecoin

Reeve Collins, the co-founder of Tether, is launching a decentralized stablecoin that will compete with the original dollar-pegged token he helped create

Tether co-founder Reeve Collins is set to launch a decentralized stablecoin that will rival the original dollar-pegged token he helped create, joining a crowded field in a corner of the cryptocurrency market that has seen intense competition.

As reported by Bloomberg on Feb. 18, Collins now serves as the chairman of Pi Protocol, a self-described decentralized project that is slated to launch on the Ethereum and Solana blockchains later this year.

According to Bloomberg, Pi will use smart contracts to allow parties to mint the USP stablecoin in exchange for the yield-bearing USI token. The stablecoin will reportedly be backed by bonds and other real-world assets.

While the stablecoin’s name suggests it will be pegged to the United States dollar, there were no details on the fiat currency or currencies that it represents.

Collins and his partners initially created Tether, the issuer of USDt (USDT), in 2014 before selling it to the operators of crypto exchange Bitfinex one year later. During that time, the value of USDt has grown from less than $1 billion to $142 billion.

Prior to announcing Pi Protocol, Collins had hinted at a yield-bearing stablecoin offering, telling Cointelegraph that such assets will attract more investors who want to earn interest on their fiat-pegged tokens.

Tether faces growing competition

Pi Protocol will be entering an increasingly competitive stablecoin market that includes Tether and other industry heavyweights like Circle’s USD Coin (USDC), Ethena’s USDe (USDe) and Dai (DAI).

According to data from DefiLlama, there are over $225 billion in stablecoins in circulation. Notably, USDC has outpaced Tether’s USDt in terms of growth early this year, while Ethena’s USDe overtook DAI to become the third-largest stable asset by market cap.

Stablecoins play a pivotal role in the cryptocurrency ecosystem, providing users with liquidity and transactional capacity as they buy and sell digital assets. Moreover, stablecoins are becoming a popular option for cross-border remittances, offering a cheaper and faster way to send money overseas.

These use cases were highlighted in a recent report by ARK Invest, which showed that the value of stablecoin transactions reached $15.6 trillion in 2024 — surpassing both Visa and Mastercard.