Moderator: Aniket (DeFi @R2)

Speakers:

• Grayson (DeFi @centrifuge)

• Nishikant (Co-Founder @Qiro_Finance)

• Josh (Head of BD @matrixdock)

• Harsh (BD manager @R2)

1. Why does the market need "yield-bearing stablecoins"?

• Yield-bearing stablecoins function as asset management tools, ranging from low-risk (T-bills at 5–7%) to high-risk (private credit at 10–18%). Unlike USDC/USDT, which focus on liquidity and payments, these stablecoins (e.g., SUSDE, SDAI) are designed for returns, similar to savings products. Key pillars are on-chain transparency, secondary market liquidity, and risk-adjusted yields, enabling flexible exits for non-instantly redeemable assets. (Grayson)

• Yield-bearing stablecoins have grown rapidly, driven by high-yield collateral like private credit. They simplify access to complex assets, making high-yield products accessible to retail investors. Transparency around collateral — especially privately placed assets — is essential to ensure backing and redemption, echoing calls for clarity seen with Tether and Circle. (Nishikant)

• Stablecoins fall into two categories: liquidity-focused (e.g., USDC/USDT for payments and trading) and yield-focused (e.g., Athena, Spark for passive income). The former emphasizes compliance and market depth, while the latter offers savings-like returns without long lockups. Protocols like Athena and Spark aim to deliver sustainable, DeFi-native yields while maintaining liquidity. (Josh)

• Yield-bearing stablecoins fill a gap left by fiat and legacy stablecoins, enabling users to earn passive income alongside utility. They act like interest-bearing money, appealing to both retail and institutional users. As demand for yield grows, these stablecoins are expected to drive greater liquidity and broader adoption. (Harsh)

2. What are the differences in risk, yield, and liquidity between T-Bills and Private Credit as stablecoin backing assets? How can protocols balance yield, liquidity, and redemption effectively?

• Private credit can offer high yields (up to 18% for short-term financing), but comes with higher risk and longer redemption periods due to illiquid assets like real estate or business loans. I suggest targeting yields above 10% while offering redemptions every 2–4 weeks to meet crypto investors’ demand for liquidity. Longer lockups (quarterly or semiannual) are less feasible. Protocols should initially focus on high yields with manageable redemptions, then build secondary markets to improve liquidity over time. (Nishikant)

• DeFi is evolving, with users becoming more open to non-instant (non-atomic) redemptions. New DeFi tools like tranching (used by Infinify, Nashpoint) and swing pricing, which protects liquidity by imposing penalties on early withdrawals. (Grayson)

• Regulatory frameworks often require compliant stablecoins to hold ultra-short-term assets (e.g., <3-month T-bills), limiting their yield. Higher returns typically involve lower liquidity and greater risk. DeFi projects offset this by incorporating native tokens to boost overall yield. (Josh)

• Comparing T-bills (5–7% yield, low risk, fast redemption) to private credit (8–12% yield, higher risk, slower redemption), likening the latter to "lending to a friend." R2 offers two stablecoin options: T-bill-backed (4–5% yield) and private credit-backed (8–12%) to suit different risk profiles. (Harsh)

3. Why do most RWA and stablecoin projects focus only on institutional clients today?

• U.S. regulations limit yield offerings for compliant stablecoins, pushing many projects to focus on institutions that can access permissionless, high-yield products. DeFi-native stablecoins can fill this gap by offering composable yields that regulated players like Circle and Tether can't. Over time, retail adoption will grow through user-friendly, on-chain protocols like Athena and MakerDAO, which abstract complexity while delivering tokenized TradFi yields. (Grayson)

• Private credit is complex, so it's easier to onboard institutional investors who already understand the risks. Regulatory burden is lower with institutions, as they’re assumed to be financially sophisticated, reducing liability. That said, I see strong potential for retail products—especially with simplified UX/UI that hides complexity, much like traditional investment apps. (Nishikant)

• Tokenization alone doesn’t make real-world assets (RWAs) retail-ready. Compliance, education, and infrastructure are still major barriers. Institutions are prioritized because they bring large capital, are KYC/KYB-ready, and understand complex assets. Retail demand won’t happen naturally without education or hype. Meanwhile, institutions often prefer to partner with stablecoin issuers like Circle instead of building in-house, due to high compliance and liquidity requirements. (Josh)

• Institutions dominate for three reasons: trust (established brands), liquidity (deep capital), and compliance (regulatory alignment). Still, I believe retail adoption will rise as consumer-friendly products emerge—ones that simplify complex assets and make them accessible to everyday users. (Harsh)

4. What are the expected developments for RWA and stablecoins in the next 3–5 years?

• Consumer-facing, on-chain native products like Athena and MakerDAO are set to drive RWA growth by creating demand for tokenized TradFi yields, such as T-bills and private credit. We’re entering an era of mobile- and AI-powered apps that mimic the look and feel of Web2 or FinTech platforms—so intuitive that users might not even realize they’re interacting with blockchain. To achieve 10x growth in RWA adoption, two things will be essential: clear regulatory frameworks and the issuance of natively on-chain assets, rather than relying on off-chain data like proofs of reserve. (Grayson)

• Institutional adoption is set to accelerate as major asset managers and fintechs (like Robinhood) move on-chain to cut costs and expand reach. A 100x surge in on-chain volume if equities are tokenized, with native on-chain issuance improving transparency and efficiency. Stablecoins will serve as the "gateway drug" for retail, with FinTech-style front ends hiding blockchain complexity and enabling better investment access. (Nishikant)

• Regulated stablecoins will power use cases like payments, remittances, and supply chain financing. U.S. regulation (e.g., Stablecoin Act) will help merge TradFi and DeFi liquidity. Asia — especially Hong Kong and China — as fast-growing markets, with asset managers upgrading virtual asset licenses. Tokenized gold stands out due to its $10T market and trust factor, enabling programmable products like indices, baskets, and funds. (Josh)

• Neobanks like Nubank and Revolut will serve as critical bridges between fiat and blockchain, enabling users to manage their salaries, invest in RWAs, or buy tokenized stocks—all through familiar mobile apps. I’m optimistic about neobank-led ecosystems powered by stablecoins, as they have the potential to simplify access to tokenized assets for retail users and drive the next wave of mass adoption. (Harsh）

5. Community Engagement and R2’s Roadmap

R2 Final Testnet is now live, with mainnet launch planned for early to mid-September 2025, followed by a Token Generation Event (TGE). We encourage community participation to help users explore and get comfortable with upcoming mainnet features.

Our global community has been built on a foundation of transparency, consistent messaging, and regular AMAs. By intentionally avoiding a regional focus, we’ve aimed for broad, inclusive appeal. Clear communication and long-term trust-building remain at the core of our community growth strategy.

Big thanks to Grayson, Nishikant, Josh, and Harsh for sharing some incredible insights during the AMA! The discussion was 🔥 — excited for what’s next. Stay tuned, big moves ahead!