Yield-Bearing Stablecoins Explained: USDY, YLDS and the Rest

Yield-bearing stablecoins by the numbers (October 2026)

DefiLlama's stablecoin list includes several yield-bearing dollar products. On 9 October 2026 the largest were Circle's USYC ($2.38B), Ondo's USDY ($2.32B), BlackRock's BUIDL ($2.20B) and Figure's YLDS ($487M). Together they are under 3% of the $311.5B dollar stablecoin market.

Token	Issuer	Supply (DefiLlama)	On Stellar	Largest chain
USYC	Circle	$2.38B	—	BNB Chain ($2.34B)
USDY	Ondo	$2.32B	$537M	Ethereum ($1.22B)
BUIDL	BlackRock	$2.20B	—	Solana ($925M)
YLDS	Figure Certificate Company	$487M	$25M	Provenance ($462M)

On Stellar, USDY has grown fast: DefiLlama's series shows about $0.56M in September 2025, $110M in March 2026 and $467M in July, before reaching $537M. That makes USDY the largest dollar token on Stellar by DefiLlama's count, ahead of USDC, and more than half of the network's $931.5M of USD-pegged supply. Funds such as USYC and BUIDL are covered in detail in tokenised money market funds.

Stellar's share of YLDS is smaller: $25.2M of $487M, about 5%, with nearly all the rest on Figure's own Provenance chain. DefiLlama prices YLDS at about $1.00, because it pays interest out rather than accruing it in the price, while USDY and USYC trade above $1.13. That single difference decides how each token behaves in a pool or as collateral.

How to choose

• You are outside the US and want Treasury yield on-chain: USDY is the main option on Stellar; minting or redeeming there has a $5,000 minimum and you must qualify as a non-US investor.
• You are a US investor: look at SEC-registered products such as YLDS or registered tokenised funds.
• You want yield and are willing to take market risk: synthetic designs such as sUSDe pay from trading strategies, and that yield can fall or turn negative.
• You want a dollar for payments: use a plain stablecoin; yield-bearing tokens are not designed as cash.

How they pay yield

Yield reaches holders in one of three ways: the token's price rises (accumulating), the token balance grows (rebasing), or interest is paid out on a schedule. Underneath, the money comes from Treasury bills and repo, from derivatives basis trades, or from the issuer's general investment portfolio.

Accumulating tokens are simplest on-chain, because balances never change, but they do not stay at $1. USDY traded at about $1.149 on 9 October on DefiLlama. Rebasing tokens stay at $1 and mint new units daily, which some DeFi contracts handle badly. Scheduled payouts, as with YLDS, look most like a bank account. Where stablecoin yield comes from more generally, including lending and liquidity provision, is covered in stablecoin yield explained.

Legal structure — why they are not "stablecoins"

The GENIUS Act forbids permitted issuers from paying "any form of interest or yield" for simply holding a payment stablecoin, and MiCA forbids e-money token issuers and crypto service providers from granting interest. So yield products are issued as securities, notes or fund shares, under securities law rather than stablecoin law.

The US definition makes the split explicit: a digital asset that is a security under the Securities Act, the Exchange Act or the Investment Company Act is excluded from the GENIUS definition of a payment stablecoin. A product that pays interest and is registered with the SEC sits on the other side of that line. MiCA's ban is broader: Article 50 treats "any remuneration or any other benefit related to the length of time" a holder keeps the token as interest, whether paid by the issuer or by third parties. The two regimes are compared in MiCA vs the GENIUS Act.

USDY — Ondo's tokenised note

USDY is a tokenised note, which Ondo's documentation says was issued by Ondo USDY LLC and folded into its Ondo Stocks structure on 15 December 2025. It is backed by short-term US Treasuries and bank deposits and offered to qualifying non-US investors. Ondo's page showed 3.75% APY on 8 October; DefiLlama showed 3.65%.

Ondo describes USDY as "debt issued by bankruptcy-remote entity", freely transferable once issued, with subscriptions and redemptions available daily. On 8 October its page put about 89% of the portfolio in US Treasuries. USDY accumulates yield in its price; rUSDY is a rebasing wrapper that holds at $1. On Stellar, Ondo's docs set a $5,000 minimum to mint or redeem.

On Stellar, USDY is used in DeFi. Aquarius showed a USDY/USDC pool of about $2.0M on 9 October, and XOXNO accepts USDY as collateral at 80% LTV, priced from a RedStone "fundamental" feed with a sanity band of $1.08 to $1.32. Lenders price it from its net asset value, not as a $1 coin. Related products on the network are compared in RWA platforms on Stellar.

YLDS — Figure's SEC-registered certificate

YLDS is issued by Figure Certificate Company, a face-amount certificate company registered with the SEC under the Investment Company Act of 1940. Its prospectus sets the rate at overnight SOFR minus 35 basis points, accruing daily and paid monthly, with a $0.01 face amount per certificate.

The prospectus is plain about the structure: the certificates are "unsecured and solely backed by the assets of Figure Certificate Company", not bank deposits and not FDIC-insured. A 2025 filing describes YLDS as backed by short-term Treasury securities and repo. Interest is reinvested automatically unless the holder opts out, and certificates can be surrendered at face amount plus accrued interest.

Transfers are restricted: on-chain counterparties are limited to holders who have passed Figure's KYC and opened an account. Provenance is the primary chain, and the prospectus says Figure may also use Solana, Stellar, Avalanche and Sui. DefiLlama first records YLDS on Stellar on 6 May 2026, at about $25M by October.

sUSDe and synthetic designs — yield from trading

sUSDe is staked USDe. Ethena calls its rewards "fully discretionary", accruing as a rising USDe value per sUSDe. Its documentation lists protocol revenue from funding and basis on delta-neutral trades, overcollateralised lending, tokenised real-world assets and stablecoin rewards. DefiLlama shows no USDe on Stellar.

Ethena says periods of negative protocol revenue are designed to be borne by its Reserve Fund, and that funding and basis have historically been positive because of demand for leveraged exposure. That demand rises and falls with markets. They do not rely on a bank or a Treasury custodian, but they do rely on exchanges, custodians and hedges working under stress. They belong in a different risk bucket from Treasury-backed notes.

Risks

Each design carries the risk of its wrapper: eligibility and transfer limits for notes and certificates, issuer credit for unsecured products, and trading losses for synthetic ones. On-chain, a price above $1 can mislead pools and lenders that assume a dollar coin.

• Eligibility: USDY excludes US persons; YLDS requires Figure KYC. A token in your wallet does not guarantee you can redeem it.
• Issuer credit: YLDS is an unsecured claim on its issuer; USDY relies on its bankruptcy-remote structure.
• Rate risk: Treasury-based yields fall when central bank rates fall.
• Pricing: lenders must use NAV-style feeds, as XOXNO does for USDY.
• Fakes: Horizon lists many unofficial assets coded USDY and YLDS. Check the issuer's home domain.

The wider risk list for DeFi use is in DeFi risks.

How these fit together

Payment stablecoins and yield-bearing tokens are converging on the same collateral, Treasury bills, but the law keeps them apart: one may not pay interest, the other must be a security. Stellar has leaned into the second group, with USDY now its largest dollar token by DefiLlama's count. For holders, the choice is less about headline yield than about who may hold the token, how it is priced, and whose balance sheet stands behind it. For plain dollars, see USDC vs USDT.

The takeaway

Yield-bearing stablecoins are useful, regulated ways to earn short-term rates on-chain, provided you qualify to hold them and understand the wrapper. Read the eligibility rules first, check the issuer, and treat anything paying well above Treasury rates as taking more risk than a Treasury bill.

Sources: DefiLlama stablecoins API, including /stablecoin/129 (USDY) and /stablecoin/272 (YLDS), and yields API (9 Oct 2026); ondo.finance/usdy (8 Oct 2026); docs.ondo.finance USDY basics; Figure Certificate Company prospectus (SEC Form 497, 24 Apr 2026) and Form 497 filing (16 Oct 2025); docs.ethena.fi protocol revenue; Aquarius pool API (9 Oct 2026); XOXNO rs-lending-xlm configs/mainnet at 598aa1f; GENIUS Act, Public Law 119-27, s. 4(a)(11); Regulation (EU) 2023/1114, Article 50.