Yield-bearing crypto assets poised to grow after regulatory clarity, report says
Synopsis
Yield-bearing crypto assets are poised for rapid growth following the GENIUS Act, which brings regulatory clarity to stablecoins, boosting institutional interest despite limited existing yield infrastructure.
Yield-bearing assets in the cryptocurrency market are expected to grow rapidly as institutional adoption accelerates after the passage of the GENIUS Act, blockchain firm RedStone said in a report on Wednesday.
The U.S. has enacted the GENIUS Act, a stablecoin law that creates a regulatory framework for dollar-pegged cryptocurrencies, sparking a surge in interest-bearing stablecoins.
However, institutional investors have remained cautious despite tokenization making transactions cheaper and faster, largely due to the absence of clear risk metrics.
Crypto TrackerTOP COINS (₹) BNB82,876 (2.46%)Ethereum282,284 (0.88%)XRP203 (0.26%)Tether89 (-0.07%)Bitcoin8,555,811 (-0.4%)
WHY IT MATTERS
Unlike traditional finance, where capital routinely earns interest, most crypto assets do not provide any returns beyond their rise in prices. Yield-bearing crypto assets could unlock significant funds and encourage major financial firms to enter the space as regulations improve.
Did you Know?
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BY THE NUMBERS
The market size of interest-bearing stablecoins has jumped 300% over the past year as new projects emerge to compete with Tether and Circle, the report said.
“Yield-generating assets make up just 8% to 11% of crypto, compared to 55% to 65% of traditional finance,” underscoring how underdeveloped crypto’s yield infrastructure remains, the report said.
While crypto’s total market capitalization was about $3.55 trillion, only $300 billion to $400 billion of those assets generated any yield, the report added.
This gap is crypto’s “greatest opportunity,” the report said.
