The supply of yield-generating stablecoins has jumped sharply following the U.S. approval of the GENIUS stablecoin bill in July, which bans issuers from offering yields directly on stablecoins.
Despite the restriction, tokens like Ethena’s USDe and Sky’s USDS, which offer yield through staking in their own protocols, have seen major growth.
Since July 18, USDe’s supply has surged by 70% to reach 9.49 billion, making it the third-largest stablecoin by market cap. At the same time, USDS has grown by 23%, with its supply nearing 4.81 billion, placing it fourth among all stablecoins, according to DefiLlama.
This strong demand has also boosted Ethena’s governance token, ENA, which has climbed nearly 60% since mid-July to about $0.58, based on CoinGecko data.
The Stablecoin Market Surges 23.5% in 2025
The total value of the stablecoin market has grown by 23.5% this year, from $205 billion in January to $268 billion now, according to DefiLlama.
Morena believes that if this growth continues, the market could reach $300 billion by the end of the year.
However, Temujin Louie, CEO of Wanchain, warned that the rise of tokenization in traditional finance might slow stablecoin growth. He explained that tokenized money market funds offer similar speed and flexibility as stablecoins, but with more safety and regulation.
A report from July also suggested that demand for decentralized finance (DeFi) apps on Ethereum could increase. This comes after the GENIUS Act, which bans stablecoins that offer yields.
So-called yield-bearing stablecoins offer holders a real rate of return, meaning returns adjusted for inflation. With the U.S. inflation rate standing at 2.7% in June, some of these stablecoins are delivering significantly higher gains in real terms.
Staked USDe (sUSDe), issued by Ethena, currently offers an annual percentage yield (APY) of 10.86%, resulting in a real return of approximately 8.16% after accounting for inflation. Meanwhile, Sky’s staked USDS (sUSDS) provides an APY of 4.75%, translating to a real return of around 2.05%.
How Yield-Bearing Stablecoins Create Passive Income
Stablecoins are increasingly being used to generate passive income through methods such as staking, lending, or investing in real-world assets like U.S. Treasurys. These strategies allow tokenholders to earn yield while maintaining exposure to price-stable digital assets.
These figures show that yield-bearing stablecoins are becoming an attractive option for crypto users seeking income-generating assets that outperform traditional financial products like savings accounts or even government bonds.
