Written by: Web3 Farmer Frank
What is the core competitiveness of the stablecoin business?
"Credit."
StakeStone founder Charles's response is straightforward and candid, and in the stablecoin battleground, the typical embodiment of 'credit' is represented by USD1, which relies on the credit backing of the Trump family. Within less than 100 days of its birth, USD1 has achieved phenomenal '0 to 1' growth and complete coverage of top exchanges.
Since March, the issuance has soared to 2.1 billion USD, surpassing FDUSD and PYUSD to become the fifth largest stablecoin globally (according to CoinMarketCap data), and it has fully landed on top CEXs such as HTX, Bitget, and Binance. In contrast, PYUSD, backed by PayPal for two years, is still struggling to penetrate the market.
In Charles's view, 'the essence of currency issuance is credit.' The stronger the credit, the faster the adoption will be, so he is confident that USD1 will be the most promising stablecoin in 2025.
So, why did StakeStone secure this first ticket?
"The development logic of USD1 is distinctly different from USDT/USDC." USD1's unique credit backing makes its promotion in the real world more capable of cross-domain adoption and resource integration compared to traditional stablecoins.
Therefore, the greatest growth potential of USD1 does not lie in the Web3 circle, just like the larger proportion of today’s applications of USDT and USDC are also in traditional finance, including but not limited to: large financial institutions, cross-border trading companies, small and medium-sized enterprises, individual entrepreneurs (such as freelancers and content creators), and regions with underdeveloped financial services. These areas will greatly benefit from the proliferation of digital stablecoins.
The widespread adoption of USD1 on-chain must be achieved through a full-chain liquidity hub. Therefore, according to Charles, as early as the second half of 2024, StakeStone began discussions with World Liberty Finance (WLFI), the issuer behind USD1, about cooperation on full-chain liquidity.
The key factor that truly prompted WLFI to choose StakeStone is StakeStone's demonstrated multi-chain operational capabilities in previous products like Berachain, especially its functional performance in the 'full-chain liquidity distribution' it has always built—therefore, in the ecological map of USD1, StakeStone actually plays a dual role: as the official minting channel and the full-chain liquidity hub. This provides USD1 with a one-stop portal for minting to full-chain and full-scenario coverage.
From this perspective, StakeStone's undertaking of USD1 is a tacit agreement between WLFI and USD1. This interview hopes to understand the cooperation logic between WLFI/USD1 and StakeStone through Charles's perspective, and what fundamental changes he sees happening in the stablecoin landscape, thus unveiling the key pieces of this new narrative in the stablecoin sector.
Why did WLFI choose StakeStone at the end of last year?
When asked why StakeStone became the first DeFi minter for USD1, Charles first broke down the issuance mechanism of USD1:
Institutional users, after completing KYC certification and other compliance processes, need to deposit dollars into designated custodian bank accounts. After WLFI verifies that the funds have arrived, institutions can mint USD1 in minimum units of 100 USD—but the USD1 balance in this process remains within the account system and has not yet gone on-chain; it must be 'withdrawn' to enter the public chain world, and currently, USD1 only officially supports Ethereum and BNB Chain (with the latter accounting for more than 98% of the total issuance).
In other words, in the current on-chain environment, USD1 has not achieved native multi-chain deployment. To realize the circulation and usage of USD1 on other chains, there are currently only two ways. One is to rely on official cross-chain bridges, but that is far from enough; it can only solve the 'cross-chain existence' of assets, but cannot build complete application scenarios. The second is to build an independent full-chain distribution system through partners.
StakeStone is entering at this critical juncture, utilizing its multi-chain distribution and scenario operation capabilities to distribute USD1 across more than 20 chains, achieving native landing and application in multi-chain DeFi scenarios.
According to Charles, the StakeStone and WLFI teams began multiple rounds of discussions starting at the end of 2024. The decision to cooperate could not be separated from the asset distribution system that StakeStone has established in the multi-chain ecosystem, and they also valued its rich experience in integrating blue-chip asset returns, which can quickly introduce USD1 into real DeFi application scenarios. This also means that from the very beginning of USD1's birth, StakeStone was not just a 'minting party,' but more like a strategic partner in its move towards a multi-chain ecosystem—responsible not only for achieving full-chain distribution of USD1 as a core hub but also for building interest-bearing products across DeFi chains, providing yield certificates, and creating the on-chain use soil for USD1, aiming for an integrated connection of 'fiat deposit → minting → multi-chain distribution → on-chain and off-chain scenario docking' to build a truly one-stop liquidity closed-loop service for USD1.
The following are related interview questions:
Frank: We see StakeStone as the 'official full-chain liquidity support partner of USD1 stablecoin.' Can you introduce the specifics of the collaboration with WLFI and what core support and services StakeStone will provide for USD1?
Charles: Currently, we are both a minting service provider for USD1 and deeply involved in its governance ecosystem, undertaking the construction of full-chain liquidity. Future cooperation plans include:
Payment products: Launch payment tools based on USD1 to support global enterprises in directly receiving USD1 through Visa/Mastercard, and integrate into traditional banking systems as stablecoins become legalized.
Full-chain DeFi yield products: Launch a one-stop full-chain yield product USD1 LiquidityPad Vault on-chain.
CeDeFi products: Simultaneously build USD1CeDeFi products that combine traditional financial institutions' dollar wealth management products and quantitative trading returns.
Compliance channel construction: Apply for payment licenses in multiple countries to open up a one-stop exchange path from fiat to USD1, gradually replacing OTC channels.
Frank: Currently, USD1 has high qualification requirements for mint service providers. Why did WLFI choose StakeStone as the first DeFi protocol minting service provider, and what prompted this cooperation?
Charles: Our cooperation with the USD1 team began at the private placement stage at the end of last year (Q4 2024), where we participated early in their technology path planning. Based on our successful liquidity distribution experience in multiple projects, the USD1 team recognized our capabilities in multi-chain ecosystem construction, and both parties eventually reached a strategic partnership.
Frank: Previously, StakeStone had not launched any business or products directly related to stablecoins. Does this deep collaboration with USD1 mark StakeStone's formal entry into the compliant stablecoin field?
Charles: We indeed did not have stablecoin products before; this cooperation is our first step into the stablecoin infrastructure. In the future, we will certainly develop a complete set of products around USD1, including the USD1 LiquidityPad full-chain liquidity distribution vault, minting, and stable interest-bearing products.
These are actually all things that StakeStone is already good at; it's just that previously we mainly served blue-chip assets or public chain assets. Now we will provide a complete 'stablecoin as a service' solution for USD1.
Frank: As the 'first DeFi protocol minting service provider for USD1,' will ordinary users be able to directly mint or cross-chain exchange USD1 through StakeStone in the future?
Charles: We certainly hope to package this mechanism well, for example, users can bind their bank cards through StakeStone's front end, make direct fiat deposits, and then the system backend will mint USD1 through our institutional account, which will then bridge to the target chain selected by the user. This achieves a full-process one-stop experience from deposit, minting to distribution.
Currently, we are already laying out compliance licenses in this area, especially in regions like Singapore and Hong Kong, where compliance licenses are more clearly defined, to open payment channels. In the future, users may be able to exchange USD1 through credit cards, SWIFT, wire transfers, and other methods.
"The greater application scenarios for USD1 are not in the crypto circle," a new growth paradigm of full-chain liquidity × global liquidity.
"The greater application scenarios for USD1 are not in the crypto circle."
StakeStone is also preparing payment products based on USD1 to provide compliant and efficient global aggregation payment products for small and medium-sized enterprises, digital nomads, and self-employed individuals.
He believes that the market pointed to by this direction is the larger second half of stablecoins that cannot be ignored. StakeStone not only aims to provide 'stablecoin as a service' full-stack support for USD1 but also attempts to promote its evolution into an 'on-chain dollar API' that serves real settlements and global circulation.
The following are related interview questions:
Frank: Full-chain stablecoin distribution products may seem a bit abstract; could you provide an example of how ordinary users can use USD1 across the entire chain through StakeStone, participate in different ecosystems, and earn returns?
Charles: It can be simply understood as a 'three-step process.' Users first deposit USD1 into StakeStone's liquidity vault, StakeStone issues interest-bearing stablecoin certificates, and users then earn returns by participating in target chain blue-chip DeFi scenarios (such as Morpho, Pendle, etc.) through the interest-bearing certificates they hold.
At the same time, StakeStone will distribute the underlying USD1 into the full-chain ecosystem, participating in the deployment of cross-chain multi-yield strategies.
Finally, users can effortlessly receive full-chain returns through the interest-bearing certificates they hold.
Frank: From the perspective of ecological cooperation, how do you evaluate the synergistic value of this StakeStone × USD1 collaboration? Does this mean that both parties will form a long-term alliance of stablecoin + liquidity protocol to jointly penetrate multi-chain and cross-regional markets?
Charles: In the future, we will be a one-stop portal for USD1 from minting to distribution.
In the crypto space, we have issued a dedicated LiquidityPad vault for USD1 to help it expand into multi-chain DeFi scenarios. We will also launch RWA+CeDeFi products based on USD1 to provide stable interest-bearing services. In the traditional financial sector, we are advancing the application and cooperation for payment licenses, aiming to achieve a compliant, low-friction path for users to mint USD1 directly from fiat, effectively opening up the entry point for off-chain funds.
For this closed loop to truly materialize and operate smoothly, it still requires the push of three key variables: firstly, regulatory progress, such as whether policies like the U.S. (stablecoin bill) can be successfully implemented, which will directly determine the legality of the fiat channel for USD1; secondly, the penetration ability of scenarios, namely whether small and medium-sized enterprises, cross-border freelancers, and global trading institutions will widely adopt USD1 as a payment tool; lastly, the ability to expand interest-bearing products, which means whether the on-chain returns of USD1 can be further extended to RWA, national bonds, and other off-chain assets, as well as CeDeFi.
The biggest Alpha in 2025 will be 'legal stablecoins,' and the true realization of this closed loop depends on the joint drive of regulation, scenarios, and products.
What's the next step?
"The stablecoin industry has entered the second half, and the focus of competition is shifting from scale and traffic to compliance capability and scenario penetration."
In addition to product cooperation, Charles also shared his understanding of the role of stablecoins in the future landscape of the industry during this dialogue. He believes that legal stablecoins represent a watershed moment for the crypto industry.
The emergence of legal stablecoins will gradually eat into the market of traditional fiat currencies in cross-border payments. It is clear that crypto stablecoins have lower costs for ledger security maintenance and lower global access costs.
The emergence of legal stablecoins will end the existing P2P deposit and withdrawal structure, which will eventually be replaced by licensed currency exchange companies in various countries.
The emergence of legal stablecoins will blur the business boundaries between traditional banks and Web3 stablecoin asset management projects, and in the future, there will only be differences in accounting methods (centralized database accounting vs. on-chain accounting) and regulatory requirements, with their business boundaries becoming increasingly close.
Therefore, StakeStone will steadfastly embrace the stablecoin market in 2025, especially emerging stablecoins like USD1 that are most likely to become legal stablecoins.
