Tether Co-Founder Reeve Collins Says Stablecoin 2.0 Puts Reserves Onchain
Reeve Collins, who co-founded Tether in 2014, said on Wednesday, September 23, 2026, that the next iteration of stablecoins will move collateral onto the blockchain while separating yield from the token itself and distributing returns programmatically. Collins, who now leads a yield-bearing stablecoin project, made the comments during a panel discussion at the Token2049 conference in Singapore.
His vision, which he calls “Stablecoin 2.0,” would make reserve backing transparent and verifiable in real time, a departure from the current model where issuers publish periodic attestations. Collins did not provide a specific timeline for when such a model might be widely adopted, but he argued that onchain reserves would become a standard feature for credible stablecoin issuers by 2028.
Onchain Reserves Could End The Trust-Me Era
Today, the largest stablecoins—Tether’s USDT and Circle’s USDC—hold reserves in traditional assets like U.S. Treasury bills and cash equivalents. Those reserves are attested to by accounting firms on a monthly or quarterly basis, but they are not visible on a blockchain.
Collins argues that putting reserves onchain would let anyone verify collateral in real time, reducing the need to trust an issuer’s periodic reports. In practice, this could mean tokenized Treasury bills or other real-world assets held in smart contracts that automatically update the stablecoin’s supply based on deposits and redemptions.
The idea is not entirely new. Projects like MakerDAO’s DAI and newer entrants like Ethena’s USDe already use onchain collateral, though not always in the form of traditional assets. What Collins is proposing is a broader shift for fiat-backed stablecoins, which currently represent the vast majority of the market.
Yield Separation Could Reshape Stablecoin Economics
Collins also said Stablecoin 2.0 will split yield from the token itself, meaning the stablecoin would not automatically accrue interest. Instead, returns would be distributed programmatically to holders who opt in, likely through a separate smart contract or a yield-bearing wrapper.
This structure could help issuers navigate regulatory uncertainty. In the U.S., the GENIUS Act, signed into law in 2025, prohibits stablecoin issuers from paying interest directly to holders. By separating yield, issuers could comply with such rules while still offering returns through third-party protocols.
“The stablecoin should be a payment instrument, not an investment product,” Collins said. “Yield should be a separate layer that users can choose to access.”
AI Could Make Crypto Invisible By 2028
Collins also predicted that artificial intelligence will hide much of crypto’s technical complexity, turning blockchain-based finance into infrastructure that users barely notice. He compared it to the early internet, where users had to understand protocols and dial-up modems, but today the underlying technology is invisible.
“In five years, you won’t know you’re using crypto,” he said. “AI will abstract away the wallets, the gas fees, and the bridges. You’ll just use financial services that happen to settle on a blockchain.”
That vision aligns with a broader trend of AI agents transacting onchain. Several projects are already experimenting with AI-powered wallets that can execute trades and payments autonomously, though mainstream adoption remains years away.
Market Context: Bitcoin Slips As Stablecoin Supply Hits $180 Billion
The comments come as the total supply of stablecoins sits near $180 billion, according to data from DeFiLlama, with USDT and USDC accounting for roughly 85% of that total. Meanwhile, Bitcoin traded at $83,319.98 on Thursday, September 24, 2026, down 1.26% over the past 24 hours, as the broader crypto market cooled following a week of gains.
Collins’ remarks highlight a growing divide in the stablecoin industry. On one side are incumbents like Tether and Circle, which prioritize regulatory compliance and traditional reserve management. On the other are newer projects experimenting with onchain reserves and yield-bearing designs.
If Collins is right, the next wave of stablecoins could look very different from the dollar-pegged tokens that dominate today. But the transition will depend on regulatory clarity, technical feasibility, and market demand—none of which are guaranteed.
For now, the market is watching whether major issuers will adopt onchain reserves voluntarily or wait for regulators to force their hand. A key date to watch is January 2027, when the U.S. Treasury is expected to release final rules under the GENIUS Act. Those rules could determine whether Stablecoin 2.0 becomes the standard or remains a niche experiment.
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