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Stablecoins beyond narrow banking - Lombard Notes
the evolution of stablecoins, why not all “stables” are equal, and a potential architecture for tokenised deposits that reconnects money and credit onchain — moving from fully reserved digital cash toward a programmable banking stack
Stablecoins beyond narrow banking - Lombard Notes
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- 2. Giorgio Giuliani 10+ yearsbuilding at the intersection of finance and software. Navigating crypto since 2014. Born in 2020. Featured on Forbes as one of the most interesting fintech blogs 2022.
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- 4. The stablecoin spacehas grown from an obscure niche of the crypto space to an industry with a supply of almost $300B. ~65% ~25% Stablecoin duopoly Stablecoins adoption Source: VISA - visaonchainanalytics.com
- 5. In 2025, 316mof unique addresses were active, with a peak of 55m Monthly Active Addresses in July 2025. Stablecoins adoption Use cases - Onchain activities (DeFi) - Remittances - Web3 fintechs - Grey economy - more… Source: VISA - visaonchainanalytics.com
- 6. The term 'stablecoin'has become a catch-all label for very different instruments, from true monetary tokens to synthetic trading strategies masquerading as money. These 'stablecoins' are financial products with embedded risk, marketed as money. Not all 'stablecoins' are equal USD.AI BUIDL USDe Synthetic $ designed to finance physical infrastructure of AI, targeting 1015% APR Yield-bearing fund invested in TBills BlackRock Ethena $600M $1.8B $6.4B Demystifying stablecoins Synthetic $ backed by delta-neutral holdings in Bitcoin, Ethereum, and other crypto assets.
- 7. USDC & USDT:Narrow banks onchain Demystifying stablecoins ● “Fully reservedˮ (no credit creation) ● Deploy reserves in yield-bearing assets ● No pass-through to token holders ● “Safeˮ but economically inert In the first 3 quarters of 2025, Tether generated ~$10b in net profits
- 8. USDC & USDTreserves Demystifying stablecoins Source: Tether Reserves Report Q3/25 Source: circle.com/transparency
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- 10. Onchain credit: Apartial attempt The proposal Tokenization Asset originator Spread mainly absorbed by SPV costs, legal structuring, offchain servicing, and Centrifugeʼs fees Tokenises real-world assets through onchain structured credit Collateral Collateral NFT DROP/TIN token $$ DAI DAI DAI DAI stablecoin issuer, backed by diverse portfolio of cryptos and RWA MakerDAO (sky.money) SMEs LPs Securitization Paid: >10% Received: 3-8%
- 11. The missing piece Theproposal Credit funded directly by investors rather than deposit creation, no maturity transformation and no creation of money from thin air. Platform to originate, securitise, and manage HELOCs. Private credit tokenisation. Total origination: $20b Total origination: $2b Assets LPs
- 12. Tokenised deposits The gamechanger Traditional Stablecoins Tokenised Deposits A deposit-like token backed by reserves AND credit originated onchain Deposit tokens: legal claims on reserves and longer-dated credit, not just reserves alone. Reserves Stablecoins Reserves Credit Deposit tokens Equity
- 13. Unlocking true onchainfinance Conclusion Singleness of money Endogenous supply Programmable banking Algorithmic oversight All deposit tokens created equal DeFi evolves from piggybacking on TradFi to a true financial system Maturity transformation, liquidity management, credit creation Real-time liquidity ratios via oracles and onchain accounting
- 14. Next Further reading Fractional ReserveBanking onchain Lombard notes - Link Stablecoins are rails, not tokens Lombard notes - Link A Network Model of Money Dirt Road - Link Stablecoins 2.0 Lombard notes - Link Tether in 2025: a Capital Analysis Dirt Road - Link A taxonomy of stablecoins Dirt Road - Link
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