In a landmark decision, the U.S. Securities and Exchange Commission (SEC) has approved YLDS as the first yield-bearing stablecoin registered as a public security. This development, reported by Figure Markets, marks a significant step in bridging traditional finance with blockchain-based assets.

YLDS functions by offering an interest rate calculated as the Secured Overnight Financing Rate (SOFR) minus 0.50%. With SOFR currently at 4.35%, investors in YLDS can earn an annual percentage rate (APR) of 3.85%. Interest accrues daily and is distributed monthly, giving holders the flexibility to receive payouts in either USD or YLDS.

One of the key advantages of YLDS is its accessibility. Investors can trade the stablecoin 24/7 on Figure Markets using USD or other stablecoins. Additionally, they have the option to convert their holdings into fiat currency during standard U.S. banking hours, ensuring liquidity and ease of access.

Developed by Figure Markets, a fintech company specializing in blockchain-based financial solutions, YLDS was designed to merge the stability of traditional stablecoins with the added benefit of interest generation. Its SEC registration ensures full regulatory compliance, making it an attractive option for those seeking both security and passive income.

With a 3.85% APR, YLDS is positioned competitively within the fixed-income landscape. While its yield is slightly lower than the average high-yield savings account rate of 4.75%, it outperforms U.S. Treasury bonds, where 10-year notes yield around 2.89% and 30-year bonds average 3.24%.

The approval of YLDS by the SEC represents a major shift in how yield-bearing digital assets are integrated into the financial system. As the stablecoin market continues to evolve, YLDS could pave the way for further innovations that blend traditional investment mechanisms with the efficiencies of blockchain technology.

By Alejandro Silva Ramírez, Crypto Analyst & Columnist