USDY is a yield-generating stablecoin backed by U.S. Treasury bonds and bank demand deposits.

USDY, short for Ondo US Dollar Yield, is a stablecoin launched by Ondo Finance. Its main features include not only pegging to the value of the US dollar but also providing holders with a certain interest yield. The underlying assets of USDY consist of a basket of short-term US Treasury bonds and bank demand deposits, which ensure its stability and yield. Through the tokenization of assets, USDY provides non-US investors with exposure to the US dollar and competitive returns, while also maintaining high liquidity and accessibility.

USDY operates on blockchain networks such as Arbitrum, utilizing smart contracts to automate lending protocol terms, reducing the need for intermediaries and lowering transaction costs. Its issuer, Ondo Finance, employs compliance measures and risk management strategies to ensure the stability and security of the token's value.

Compared to traditional stablecoins (such as USDT and USDC), the biggest feature of USDY is "yield generation," meaning holders can earn returns from the underlying assets. This makes USDY highly attractive in the decentralized finance (DeFi) space, especially for users looking to achieve dollar stability while earning interest.