Former Algorand CFO Mathew Commons has revealed bold plans and team expansions as USDV transitions into its next growth phase. The stablecoin newcomer, Verified USD (USDV), aims to achieve native integration on more blockchains than any other stablecoin, positioning itself as a key player in the rapidly evolving cryptocurrency landscape.

Despite a modest market cap of just over $20 million, USDV has made significant strides since its soft launch on Ethereum in November 2023. It has successfully extended its omnichain capabilities to eight EVM-enabled chains, including Arbitrum, BNB Chain, Optimism, and Avalanche. In an exclusive interview with Cryptoslate, Commons, now President of the Verified USD Foundation, shared insights into why the industry needs another stablecoin and how USDV differentiates itself.

The concept for USDV emerged from a collaboration between Canadian interoperability protocol LayerZero and Singapore-based crypto financial services company Matrixport. "They envisioned a stablecoin that would align with the decentralized ethos of our ecosystem while maintaining a fully reserve-backed model," Commons explained.

USDV's governance structure is a significant departure from traditional stablecoins, which are often centralized. "Legacy stablecoins have played a crucial role in the market, but they pose centralization risks," said Commons. USDV, in contrast, is set up as a foundation, emphasizing decentralization and community involvement.

A key innovation of USDV is its attribution mechanism, ColorTrace, which tracks which partners bring new capital into the system and allows yield sharing. "Unlike legacy stablecoins that keep the yield for themselves, we provide strong incentives for our partners to bring new users and capital into the system," Commons noted.

USDV does not mint new coins itself but provides the legal, technical, and governance frameworks for its partners, such as DeFi protocols and centralized exchanges, to mint USDV. These partners use a permissionless collateral token, STBT (short-term treasury bill token), locked into a smart contract to create new USDV, ensuring the stablecoin remains fully backed.

Transparency is a cornerstone of USDV's model. "We are fully backed by short-term treasury bills with a duration of three months or less, and all our collateral is on-chain," Commons emphasized. USDV's separate collateral token, STBT, ensures that each USDV is fully backed, with real-time 'Proof of Reserves' provided by Chainlink, a significant upgrade from the periodic audit reports offered by other stablecoins.

USDV’s omnichain capabilities, powered by LayerZero's technology, allow it to be burned and reminted across multiple chains, connecting it to more than 70 blockchains. "Our goal is to be the stablecoin available on the largest number of chains, including non-EVM chains and Bitcoin Layer 2s," Commons declared.

Looking to the future, Commons is optimistic about the stablecoin market's growth potential. "Analysts predict the stablecoin market could grow 30-fold in the next five to seven years. We’re not just competing within the existing market; we’re poised to benefit from its expansion," he said.

Regulatory clarity remains a challenge, but Commons sees it as an opportunity. "A stablecoin bill would provide much-needed regulatory clarity. Meanwhile, our most rapid growth is happening outside the U.S., in high-inflation economies like Argentina and Turkey, where the demand for efficient foreign exchange solutions is high," he explained.

USDV's growth strategy relies heavily on forming strong local partnerships, especially with OTC desks and community influencers. "Our business model is predicated on partnerships, offering shared yield from underlying collateral, fostering long-term collaborations," Commons said.

As USDV enters its next phase, the team is focused on expanding, securing more partnerships, and launching exciting end-user initiatives later this year. "Watch this space," Commons hinted, signaling that USDV is just beginning its journey to reshape the stablecoin market.