Opportunity
Defining the Market Opportunity and Revenue Potential for csUSDL
Last updated
Defining the Market Opportunity and Revenue Potential for csUSDL
Last updated
Stablecoins show strong product-market fit and rapid market growth. However 90% of stablecoins generate no yield, highlighting the potential for yield-generating solutions.
Recent stablecoin innovators such as Ethena's USDe, Usual's USD0, and Elixir's deUSD have collectively captured approximately $3 billion in total value locked (TVL) since February 2024.
These rapid growth rates signal strong market demand for stablecoins that provide benefits beyond mere price stability.
Coinshift recognizes the significant opportunities within the evolving stablecoin landscape and has set ambitious, yet attainable goals:
Market Capture: Achieve a minimum of 0.1% of the projected $16T stablecoin market by 2030.
AUM: Resulting in $16 billion in assets under management (AUM) for csUSDL by 2030.
Coinshift's business model for csUSDL focuses on two primary revenue streams, with a projected annual revenue of $200 million based on $16 billion AUM.
1. USDL Minting Fee Share
Partnership with Paxos International: Coinshift is positioned to receive up to 0.25% on USDL minted through the csUSDL platform.
Projected Revenue: With $16 billion in AUM, a 25 basis-point share would yield up to $40 million annually.
2. Vault Performance Fee
Initial Strategy: The Coinshift USDL vault will start with a 0% performance fee to encourage adoption and rapid growth.
Future Adjustments: The performance fee will be subject to governance by SHIFT token holders, allowing for community input to optimize fee structures. The target range for this fee is 5-10% of the borrow APY.
Revenue Example: At a 10% performance fee from a 10% borrow APY, this equates to a 1% performance fee. For $16 billion AUM, this would result in $160 million in revenue.
Coinshift’s dual revenue model aligns growth and profitability with the success of csUSDL:
Revenue Redistribution: Earnings are redistributed to token holders via SHIFT token staking (read in the tokenomics section).
USDL Expansion: Increased USDL adoption directly boosts Coinshift’s revenue through minting fees, fostering ecosystem growth.
Vault Performance: Performance-based revenue from the csUSDL vault encourages both Coinshift and the community to continually enhance yield strategies.
