- Coinshift CEO Tarun Gupta believes yield-bearing stablecoins are creating a convergence between banking, lending, and traditional stablecoins.
- Coinshift’s csUSDL token combines Paxos’ USDL stablecoin with lending functionality through Morpho Protocol, offering institutional-grade yield with transparency.
- Regulatory clarity and strong stablecoin liquidity are essential for mass adoption, with Coinshift launching its SHIFT token to drive csUSDL adoption.
The lines separating stablecoins, lending protocols, and traditional banking are dissolving as new financial primitives emerge in the cryptocurrency sector, according to Tarun Gupta, CEO of treasury management platform Coinshift. These developments could transform financial infrastructure by merging stable value storage with yield-generating capabilities.
In a recent interview with Decrypt, Gupta outlined how yield-bearing stablecoins like Coinshift’s csUSDL are leading this transformation.
“For the past six or seven years, stablecoins have solved one simple use case, which is money,” Gupta explained. “Today, you can basically make the movement of money faster, cheaper and better with stablecoins. However, they’re not solving any kind of yield use case or lending use case.”
Gupta argues that the fundamental innovation behind yield-bearing stablecoins is what he terms an “architecture of promises” – a combination of transparent, verifiable on-chain assets coupled with established trust mechanisms.
“How I see this is, you need a trust layer, and then you need a transparent layer on top,” he said. “Once you combine these two layers with the power of smart contracts and blockchain, you end up having a lot of convergence between banking, lending and yield mechanisms.”
This thesis led to Coinshift’s development of csUSDL, which Gupta describes as combining Paxos‘ USDL stablecoin with lending functionality through Morpho Protocol, a system for creating verifiable lending markets.
Users holding csUSDL aren’t required to trust Coinshift directly. Instead, trust is placed in the underlying protocol, smart contracts, and the immutable blockchain record. “This financial architecture is way better than what we have in TradFi,” Gupta asserted, predicting that traditional financial instruments will increasingly migrate on-chain, potentially bringing trillions in value.
For this vision to materialize, regulatory clarity remains crucial. Gupta praised crypto-friendly jurisdictions like Abu Dhabi for “setting examples for other governments on how you can innovate with new technology.” He also expressed support for the U.S. proposed GENIUS Act, noting it brings “lots of clarity” and establishes trust-building rules for reserve management.
With appropriate regulation, Gupta is “100% confident” that institutions and neobanks will adopt stablecoins, stating there’s “no reason to use the old banking infrastructure to move money.” He predicts fintech companies, including payroll providers, will migrate to stablecoin solutions, eventually outcompeting traditional banks.
In the competitive stablecoin landscape, Gupta believes winners will be determined by “the largest liquidity, deep integrations, and distribution.” Coinshift is advancing on two strategic fronts: introducing its SHIFT governance token and growing csUSDL adoption.
The SHIFT token serves dual purposes – rewarding Total Value Locked (TVL) across Coinshift’s assets and governing the ecosystem. For csUSDL, the company aims to increase its market capitalization to $100 million by targeting institutional investors.
“If you’re already holding USDC, you should think about holding csUSDL, because the risk is on the lowest side, and the secondary liquidity is also very high,” Gupta explained.
The company’s roadmap includes enhancing secondary liquidity for csUSDL, fully integrating it into Coinshift’s platform for business clients, and working with DeFi protocols to establish it as collateral or reserves for other stablecoins. Gupta highlighted that csUSDL already has “15-plus DeFi integrations on day one,” emphasizing their goal of creating a blueprint for making yield-bearing instruments more liquid in the decentralized finance ecosystem.
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