TL;DR
- Reeve Collins, co-founder of Tether, launches a new stablecoin called Pi, backed by real-world assets like bonds, to compete with USDT.
- The Pi Protocol will be launched on the Ethereum and Solana blockchains, utilizing smart contracts to issue the stablecoin.
- This move comes in an increasingly competitive stablecoin market, with major players like USDT, USDC, and DAI dominating the space.
Reeve Collins, the co-founder of Tether, has unveiled a new project aimed at directly competing with his own creation, USDT. This new stablecoin, named Pi, is part of a decentralized protocol called the Pi Protocol, set to launch on both the Ethereum and Solana blockchains later this year. What makes it unique is its focus on generating yield from assets backed by bonds and other real-world assets.
The launch of Pi Protocol aims not only to provide a stable and reliable stablecoin but also introduces an innovative approach: the possibility of earning yields by participating in USI, a token that serves as a bridge for the creation of Pi. This is significant because most current stablecoins do not generate yield and are simply pegged to the value of assets like the US dollar.
Rising Competition in the Stablecoin Market
The stablecoin market is expanding rapidly, and Pi Protocol arrives at a crucial time, with powerful players already in the field such as Tether (USDT), Circle (USDC), and Dai (DAI). According to DefiLlama, the stablecoin market exceeds $225 billion, with USDT dominating more than 63% of the market. However, competition has significantly increased in recent months, with USDC experiencing rapid growth and USDe surpassing DAI to become the third-largest stablecoin by market capitalization.
Collins, who served as CEO of Tether from 2013 to 2015, has a clear vision for his new project: to attract investors who are looking for not only stability but also yield from their assets. The idea of yield-generating assets is a growing trend within the crypto space, and the new stablecoin backed by tangible assets could be the key to bringing more people into the ecosystem.
What stands out in this new project is its use of smart contracts to facilitate the creation of Pi, providing an additional layer of transparency and security in the process. Furthermore, the backing by bonds and real-world assets adds a level of trust that could appeal to traditional investors who are still skeptical about cryptocurrencies.
Although the news has not revealed financial details about the Pi Protocol launch, this move by Collins is undoubtedly a direct challenge to traditional stablecoins.
