- Figure Markets brings the first SEC-approved yield-bearing stablecoin to Solana in the form of YLDS.
- YLDS will use the Secured Overnight Financing Rate minus 0.5% to determine its APR.
- Investors can redeem their YLDS in-kind or for USD 24/7, demonstrating the power of the blockchain for yield-bearing assets.
- The new product adds another high-profile tokenised fund to an industry demonstrating strong potential.
Despite the crypto markets having a mostly quiet February, institutions continue working away in the background to bring innovations to the blockchain industry.
Figure Markets has announced the release of a new yield-bearing stablecoin built atop Solana’s network. The token, YLDS, will follow the Secured Overnight Financing Rate minus 0.5%.
The move presents crypto investors with another stable method of generating revenue in the DeFi ecosystem.
Related: Evidence Mounts for SEC Stance Change On Staking: Source Says its ‘Very, Very Interested’
SEC Gives YLDS the Go-Ahead as ‘Registered Public Security’
The introduction of YLDS follows Solana’s strong move into the stablecoin market over the past couple of years.
At the time of writing, Solana’s network boasts around AU $15b in stablecoin market capitalization, ranking the chain third behind Ethereum and Tron.
Figure Markets’ offering is particularly noteworthy due to its approval from the Securities and Exchange Commission. The SEC greenlit YLDS as a ‘registered public security’, giving the asset a level of confidence investors may not have with non-regulated alternatives.
The APR of YLDS will be based on the Secured Overnight Finance Rate. Banks use this overnight rate for dollar-denominated loans within the United States. With the current SOFR sitting at 4.35%, it means investors can earn up to 3.85% per year.
Interest will be accrued daily, with earnings paid out monthly either in-kind or in USD.
YLDS presents several advantages over non-blockchain yield generation due to its 24/7 finality, low fees and competitive earning rates. In particular, fiat off-ramps will be provided for investors even when US markets are closed, allowing constant USD redemption.
The move from Figure Markets follows the popularity of BlackRock’s tokenised Treasury fund, BUIDL and the growth of market players like Ondo Finance.
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