Most people think stablecoins are just crypto’s boring dollars ,tokens that move value from point A to point B.

𝘉𝘶𝘵 𝘣𝘦𝘩𝘪𝘯𝘥 𝘵𝘩𝘦 𝘴𝘤𝘦𝘯𝘦 𝘴𝘪𝘵𝘴 𝘰𝘯𝘦 𝘰𝘧 𝘵𝘩𝘦 𝘮𝘰𝘴𝘵 𝘱𝘳𝘰𝘧𝘪𝘵𝘢𝘣𝘭𝘦 𝘣𝘶𝘴𝘪𝘯𝘦𝘴𝘴 𝘮𝘰𝘥𝘦𝘭𝘴 𝘪𝘯 𝘵𝘩𝘦 𝘦𝘯𝘵𝘪𝘳𝘦 𝘥𝘪𝘨𝘪𝘵𝘢𝘭 𝘢𝘴𝘴𝘦𝘵 𝘪𝘯𝘥𝘶𝘴𝘵𝘳𝘺.

But how do they actually make money? Let's see🧵👇
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While traders argue about memecoins and market cycles, a handful of stablecoin issuers quietly generate multi-billion-dollar profits every year, not from speculation, but from the float, the reserves backing the tokens everyone uses.

𝘚𝘵𝘢𝘣𝘭𝘦𝘤𝘰𝘪𝘯 𝘪𝘴𝘴𝘶𝘦𝘳𝘴 𝘢𝘯𝘥 𝘱𝘳𝘰𝘵𝘰𝘤𝘰𝘭𝘴 𝘮𝘰𝘯𝘦𝘵𝘪𝘻𝘦 𝘵𝘩𝘦 𝘧𝘭𝘰𝘢𝘵, 𝘧𝘦𝘦𝘴 𝘵𝘪𝘦𝘥 𝘵𝘰 𝘪𝘴𝘴𝘶𝘢𝘯𝘤𝘦 𝘰𝘳 𝘳𝘦𝘥𝘦𝘮𝘱𝘵𝘪𝘰𝘯 𝘢𝘯𝘥 𝘰𝘯𝘤𝘩𝘢𝘪𝘯 𝘢𝘤𝘵𝘪𝘷𝘪𝘵𝘺, 𝘭𝘦𝘯𝘥𝘪𝘯𝘨 𝘢𝘯𝘥 𝘵𝘳𝘦𝘢𝘴𝘶𝘳𝘺 𝘰𝘱𝘦𝘳𝘢𝘵𝘪𝘰𝘯𝘴, 𝘢𝘯𝘥 𝘱𝘳𝘰𝘵𝘰𝘤𝘰𝘭-𝘯𝘢𝘵𝘪𝘷𝘦 𝘳𝘦𝘷𝘦𝘯𝘶𝘦 𝘴𝘵𝘳𝘦𝘢𝘮𝘴.

The sector is huge and concentrated, centralized dollar-pegged coins like USDT, USDC etc. dominate market cap and onchain transaction volume, while decentralized designs like DAI, FRAX etc. earn protocol-level revenue from borrowing/stability mechanisms and by deploying treasury reserves into yield-earning strategies.
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How Stablecoins companies make money

➢ 𝘛𝘩𝘦 𝘱𝘳𝘪𝘮𝘢𝘳𝘺 𝘸𝘢𝘺 𝘴𝘵𝘢𝘣𝘭𝘦𝘤𝘰𝘪𝘯 𝘤𝘰𝘮𝘱𝘢𝘯𝘪𝘦𝘴 𝘮𝘢𝘬𝘦 𝘮𝘰𝘯𝘦𝘺 𝘪𝘴 𝘣𝘺 𝘦𝘢𝘳𝘯𝘪𝘯𝘨 𝘪𝘯𝘵𝘦𝘳𝘦𝘴𝘵 𝘰𝘯 𝘵𝘩𝘦 𝘳𝘦𝘴𝘦𝘳𝘷𝘦𝘴 𝘣𝘢𝘤𝘬𝘪𝘯𝘨 𝘵𝘩𝘦𝘪𝘳 𝘵𝘰𝘬𝘦𝘯𝘴.

When users hold stablecoins like USDT or USDC, the issuing company holds equivalent assets, usually cash, short-term U.S. Treasuries, repo positions, or money market funds which generate yield.

Because the total supply of stablecoins has grown into the hundreds of billions, even modest interest rates translate into enormous income, making this the most profitable and dominant revenue model in the industry.

Companies like Circle and Tether earn the bulk of their revenue this way, with both reporting multi-billion-dollar profits driven largely by reserve yields.

The model scales efficiently, as supply increases, reserve income typically rises proportionally.
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These are some key numbers;

➢ @coingecko reports the total stablecoins market cap to be around $309B and 10% of global crypto market cap.

➢ The total market cap of @Tether_to USDT is $185B and supply is 185B

➢ The total market cap of @Tether_to USDC is $74B and supply is 74B

➢ @chainalysis report shows USDT and USDC processes hundreds of billions per month

➢ @FT reporting indicated Tether posted $13.4B profit in a recent year from Treasury or treasury-like holdings and has been investing profits into ventures

➢ @Circle reported $1.68B revenue including reserve income in 2024 with reserve income the dominant share

These numbers illustrate how reserve yields scale as outstanding supply grows.
These numbers are indicators of how huge the stablecoin industry is and the huge amount of money being generated from operations.
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➢ Another way these companies make money is through fees. Fees charged when users mint or redeem fiat into stablecoin through an issuer’s banking rails or custodial on-ramps.

Exchange partners may pay listing/settlement fees. Decentralized mints sometimes charge protocol fees like minting fees, bridge fees etc.
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These companies also make money through lending, repo and treasury strategies.

It works in a way whereby issuers lend a portion of reserves or use AMO strategies to place collateral into DeFi lending pools, earn fees from lending, or run repo or treasury strategies.

These companies make money from protocol-native fees and token economics by actively deploying protocol treasuries into yield strategies and sharing revenue with token holders.

➢ @fraxfinance uses AMOs to place collateral in Curve, lending protocols and concentrated liquidity positions that earn trading fees and yield

➢ @SkyEcosystem formerly Maker DAO collects stability fees which is interest paid on DAI minted via vaults, liquidation penalties and yields on RWA deployments, revenues that feed Maker’s surplus buffer and MKR buybacks.
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Stablecoin companies offers custody, settlement rails, DeFi integrations, enterprise wallets, and payment APIs, these products generate recurring fees and diversify income beyond reserve yield

➢ Circle has been building payment rails and enterprise features like subscription & services revenue line is growing.

➢ Tether also partners with exchanges and custody provider

➢ Paxos provides custody and settlement services too

These companies do invest excess profits into venture investments, buy stakes in fintech and web3 firms, or reinvest in proprietary products.
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Highlights on some Stablecoin Companies, the models and notable metrics

➢ @Tether_to (USDT) is a centralized issuer holding large reserves invested in short-dated instruments, commercial paper and unspecified assets historically. They are the largest stablecoin by market cap with $185b. Reports say they make $13.4B profit from treasury holdings.

➢ @Circle (USDC) is a corporate issuer, their USDC reserves are primarily held in a money market fund. Circle reported $1.68B revenue and reserve income in 2024 and Q3 2025 revenue and reserve income of $740M in the quarter alone. Circle reported USDC in circulation $73–74B as of late 2025 quarter.

➢ @SkyEcosystem(DAI) is a decentralized company. They generate revenue from borrowed DAI, liquidation penalties, PSM trading fees , yields from RWA.

➢ @fraxfinance (FRAX/ frxUSD) uses a system that blends real collateral with AMOs to stabilize price and generate yield.
Frax earns revenue via AMOs that place assets in liquidity pools, lending markets, and concentrated liquidity positions.

➢ @Paxos (Pax Dollar/ PYUSD) is a regulated trust company that issues fiat-backed tokens and provides custody. They generate from reserve income, issuance fees, and enterprise service fees.

➢ @ethena_labs (USDe / sUSDe) uses a synthetic stablecoin model built on delta-neutral hedging, backing assets like staked ETH while opening short perpetual futures to maintain price stability.

Ethena generates revenue from funding rate income, basis spreads, and staking yields, with earnings flowing to sUSDe holders, making it one of the highest-yielding stablecoin structures in the market.

𝘚𝘵𝘢𝘣𝘭𝘦𝘤𝘰𝘪𝘯𝘴 𝘩𝘢𝘷𝘦 𝘲𝘶𝘪𝘦𝘵𝘭𝘺 𝘣𝘦𝘤𝘰𝘮𝘦 𝘰𝘯𝘦 𝘰𝘧 𝘵𝘩𝘦 𝘮𝘰𝘴𝘵 𝘱𝘳𝘰𝘧𝘪𝘵𝘢𝘣𝘭𝘦 𝘢𝘯𝘥 𝘪𝘯𝘧𝘭𝘶𝘦𝘯𝘵𝘪𝘢𝘭 𝘢𝘴𝘱𝘦𝘤𝘵𝘴 𝘪𝘯 𝘞𝘦𝘣3. 𝘉𝘺 𝘦𝘢𝘳𝘯𝘪𝘯𝘨 𝘪𝘯𝘵𝘦𝘳𝘦𝘴𝘵 𝘰𝘯 𝘮𝘢𝘴𝘴𝘪𝘷𝘦 𝘳𝘦𝘴𝘦𝘳𝘷𝘦𝘴 𝘢𝘯𝘥 𝘭𝘦𝘷𝘦𝘳𝘢𝘨𝘪𝘯𝘨 𝘢𝘥𝘥𝘪𝘵𝘪𝘰𝘯𝘢𝘭 𝘳𝘦𝘷𝘦𝘯𝘶𝘦 𝘴𝘵𝘳𝘦𝘢𝘮𝘴 𝘭𝘪𝘬𝘦 𝘱𝘳𝘰𝘵𝘰𝘤𝘰𝘭 𝘧𝘦𝘦𝘴 𝘢𝘯𝘥 𝘺𝘪𝘦𝘭𝘥 𝘴𝘵𝘳𝘢𝘵𝘦𝘨𝘪𝘦𝘴, 𝘪𝘴𝘴𝘶𝘦𝘳𝘴 𝘨𝘦𝘯𝘦𝘳𝘢𝘵𝘦 𝘴𝘵𝘦𝘢𝘥𝘺 𝘪𝘯𝘤𝘰𝘮𝘦 𝘵𝘩𝘢𝘵 𝘳𝘪𝘷𝘢𝘭𝘴 𝘵𝘳𝘢𝘥𝘪𝘵𝘪𝘰𝘯𝘢𝘭 𝘧𝘪𝘯𝘢𝘯𝘤𝘪𝘢𝘭 𝘪𝘯𝘴𝘵𝘪𝘵𝘶𝘵𝘪𝘰𝘯𝘴.

As adoption grows and stablecoins continue integrating into payments and global finance, their earning potential will only expand.