TLDR:
- STBL enables $50M in stablecoin mints using Ondo’s USDY, backed by short-term U.S. Treasuries and cash.
- The deal integrates tokenized yield-bearing assets directly into STBL’s reserve structure for stronger backing.
- STBL’s reserve model separates principal and yield to align with new compliance and payment standards.
- USDY’s institutional controls and collateral rights enhance the transparency and stability of USST issuance.
The stablecoin space is changing fast, and STBL wants to lead that shift. The company has partnered with Ondo Finance to introduce $50 million in new minting capacity for its stablecoin, USST. The move brings tokenized U.S. Treasury assets directly into STBL’s reserve model, tightening links between decentralized money and real-world collateral.
According to a press release, the collaboration is structured to enhance transparency, compliance, and yield management in stablecoin design.
Ondo’s USDY, a yield-bearing token backed by short-term U.S. Treasuries and bank deposits, will serve as the primary collateral for USST. By integrating institutional-grade assets, STBL aims to establish a framework that’s both scalable and compliant.
The partnership signals a growing interest in tokenized real-world assets as stablecoin reserves move closer to traditional finance standards.
How USDY Strengthens STBL’s Stablecoin Collateral
USDY is designed to deliver dollar-denominated yield while maintaining a secure structure for holders. The token gives investors a first-priority security interest over the underlying assets, held by an independent collateral agent. This structure provides a layer of trust often missing in DeFi-based reserves.
STBL plans to make USDY a core part of its collateral mix. The setup allows institutions to mint USST while keeping exposure to the yield from underlying Treasuries. That balance could allow stablecoins like USST to expand circulation without sacrificing stability or transparency.
Dr. Avtar Sehra, STBL’s co-founder and CEO, said the partnership marks a shift toward tokenized reserves. He explained that the new framework is overcollateralized and adaptable, supporting a variety of compliant, high-quality assets.
Reeve Collins, STBL’s chairman, added that this model lets value flow back to the collateral providers rather than just the issuer.
Ondo Finance’s Chief Strategy Officer Ian De Bode said USDY’s inclusion highlights how yield-bearing reserves can support large-scale digital asset infrastructure. He described the partnership as proof that compliant, tokenized reserves can serve both DeFi users and traditional finance institutions.
Inside STBL’s Reserve and Compliance Model
STBL’s reserve framework divides yield and principal into two instruments. USST remains the payment stablecoin, fully backed and non-yielding to meet compliance requirements.
The second token, YLD, carries the yield rights from the underlying assets. This separation keeps payment systems clean while allowing eligible holders to receive returns from tokenized Treasuries.
To simplify participation, STBL integrates issuer and custodian allowlists directly into its system. That setup minimizes repetitive KYC checks and ensures yield distribution stays within defined compliance zones. USST, meanwhile, circulates freely as collateral across DeFi markets.
Dynamic mint-and-burn mechanics help the stablecoin maintain its peg, supported by transparent, on-chain governance.
Parameters like redemption spreads and fee routes can adjust as markets shift. Together, the mechanisms create a stablecoin system where institutions can mint, hold, and trade with confidence while maintaining regulatory clarity.
According to STBL’s press release, the framework reflects how stablecoins can merge real-world yield assets with decentralized infrastructure. The partnership with Ondo marks another step toward a stablecoin model that mirrors traditional financial stability without giving up the openness of blockchain technology.
