Tether Co-Founder Reeve Collins: ‘Stablecoin 2.0’ Is Here and It’s a Threat to Banking Systems

Reeve Collins Warns Stablecoin 2.0 Could Disrupt Global Banking Systems. | Credit: Jakub Porzycki/NurPhoto via Getty Images

Key Takeaways

Allegations have emerged of a lobbying effort to pardon Sam Bankman-Fried. The allegations came just one day before a new interview with Bankman-Fried was released. Despite speculation, there is no official sign that the Trump administration is considering a pardon.

Stablecoins are entering what Tether co-founder Reeve Collins calls their “2.0 era,” a new generation of community-driven digital money that he claims will facilitate faster and cheaper transactions.

Talking to CCN on the sidelines of Token2049 in Singapore, Collins said that stablecoins are threatening the very fabric of “incumbent banking systems.”

From Web2 Profits to Web3

After a decade of technological stagnation but growing regulatory acceptance, the Tether co-founder said the stablecoin story has finally changed.

“The technology and what it does hasn’t changed at all,” he said. “But what’s changed is finally the narrative.”

Every major financial institution now wants in, he explained, because “they’re not going to get in trouble anymore — that’s what opened the floodgates.”

Through his new venture STBL, Collins wants to update the model for the Web3 era.

“We all know how lucrative stablecoins are for those centralized issuers,” he said. “You give them money, they get all the interest, and you get to use the token.”

STBL splits a traditional stablecoin into three components: a stable token (USST) pegged to the U.S. dollar, a yield-bearing token (YLD) that captures interest from the underlying collateral, and a governance token (STBL) that lets the community help steer the system.

Unlike USDT or USDC, where the issuer earns the yield on reserves, STBL’s model returns that value to users who provide the collateral.

Collins compared it to social media’s data trade-off:

“You spend all your time on Facebook. You give them all your data. They monetize all that, and you get entertainment. That’s very Web2. We’re now in the Web3 world,” he told CCN.

How Stablecoin 2.0 Works

The Tether co-founder’s platform leverages tokenized U.S. Treasuries as collateral to issue two assets: a yield-bearing NFT and a stablecoin, USST.

“Since you’re the one that puts the collateral into the network, you’re the one that reaps the rewards,” he said.

STBL describes itself as a stablecoin platform that splits a traditional stablecoin into three components: a stable token (USST) pegged to the U.S. dollar, a yield-bearing token (YLD) that captures interest from the underlying collateral, and a governance token (STBL).

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Unlike USDT or USDC, where the issuer earns the yield on reserves, STBL’s model returns that value to users who provide the collateral.

He believes this model will make stablecoins more transparent and equitable, rewarding users instead of corporations.

“We’re making them highly productive versus just sitting in your wallet,” he said.

The Next Evolution of DATs

Collins’ second focus is Reserve One, a billion-dollar Digital Asset Treasury (DAT) designed to provide traditional investors with crypto exposure through public markets.

When asked why now was the right time to launch, Collins replied quickly:

“That’s an easy answer — regulation, Donald Trump,” he said.

Collins said the rush of DATs, public vehicles offering crypto exposure, has cooled after an initial boom.

“There was this frenzy of DATs, and we were early,” he said. “We announced right before this flood of new DATs came to market, and that window is really closing in the way that they’re coming to market.”

He attributed the slowdown to the complexity and cost of regulation in the U.S.

“Launching and maintaining and running a public company, especially in the U.S., is extremely expensive and difficult,” he said.

He described Reserve One as a bridge between traditional markets and the blockchain economy.

“But Reserve One is a very substantial DAT,” Collins said. “We have a world-class management team and a world-class board — extremely seasoned and experienced people leading this company that can navigate the public markets with expertise, not stumble through it.

On that foundation, he Collins said the reason he was working on Reserve One was due to his passion of “delivering on the promise of blockchain.”

“The promise of Web3 is built on top of the blockchain, because now that you can plug the whole world into access, you need wallets and tokens,” he said.

Beyond ‘Buy and Hold’

Collins said Reserve One’s strategy differs sharply from that of MicroStrategy, the U.S. software company known for its massive Bitcoin holdings.

“It’s not better or worse, it’s the necessary evolution,” he said.

He said that approach made sense early on, but lacks flexibility today.

“If you want to buy Bitcoin and hold and you want to do it through a public vehicle, you can do it through an ETF,” he said.

He argued that the next wave of DATs will need to demonstrate active management and ecosystem value, not passive accumulation.

“The evolution of DATs, though, is you have to really also have an operating business that generates wealth on top of that,” he said.

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