The Innovative Split

The foundational innovation underpinning the entire STBL architecture is the separation of principal from yield.

In first-generation stablecoins (eg USDT, USDC), users deposited dollar-equivalent assets and received a token pegged to $1, while the issuer quietly kept all the interest earned on the reserves backing that token. Stability came at the cost of value capture for the user.

STBL breaks that model apart. When a user deposits an approved, yield-bearing RWA as collateral, the protocol splits it into two distinct, independent tokens:

• The Principal — minted as USST, a liquid, spendable, dollar-pegged stablecoin that can circulate freely across DeFi, payments, and trading.
• The Yield — minted as YLD, a non-fungible token that captures and accrues all the interest generated by the underlying collateral, independent of the principal.

This clean separation means stable, spendable money and the income it generates are no longer locked together. Users (or ecosystem issuers) keep both, using USST for liquidity while YLD continues to accrue and can later be claimed, transferred, or used independently. This split is also what allows STBL's model to align with regulatory frameworks since the circulating stablecoin (USST) remains non-yield-bearing on its face, while yield rights are cleanly isolated in a separate instrument (YLD).