The Mountain Protocol project announced the launch of the stablecoin USDM, backed by U.S. Treasury bonds and delivering a passive yield of 5% per year.
According to the press release, on August 27 the company obtained a digital asset issuer license from the Bermuda Monetary Authority.
USDM is an ERC-20 token, redeemable for one U.S. dollar. The coin will be issued to users who have completed KYB verification. The yield feature is not available to residents of the United States.
According to the developers, USDM can also be used within DeFi applications.
“From protocols that boost liquidity providers’ yields to exchanges that want to launch their licensed stablecoins — we see many interesting use cases for USDM,”
— added Martin Karrika, co-founder of the issuer.
The company noted that the “yield rerouting” mechanism resembles stETH from the liquid staking service Lido Finance.
Mountain Protocol also announced the close of a funding round led by Nick Carter of Castle Island Ventures, with participation from Coinbase Ventures, New Form Capital, Daedalus Angels and others. The amount raised was not disclosed due to regulatory requirements.
Earlier in August, Kaiko analysts predicted the start of ‘stablecoin wars’. Analysts noted the imbalance in the main USDT-USDC pool on Uniswap V3 and the 3pool on Curve due to the escalation of sell-offs of the ‘stablecoin’ by Tether.
In the same month, payments giant PayPal announced the launch of the PayPal USD (PYUSD) stablecoin. Paxos served as the partner.
According to Bernstein researchers, over the next five years the total market capitalization of fiat-backed crypto assets will grow from the current $125 billion to $2.8 trillion.