Falcon Finance's USDf Supply Surges 30% in Five Weeks to $648 Million

Falcon Finance, a synthetic dollar protocol, has achieved a significant milestone by surpassing $600 million in the total supply of its USDf synthetic dollar. This accomplishment, reached just five weeks after crossing the $500 million mark, underscores the protocol's rapid expansion and the surging demand for its yield-generating asset, which is being widely adopted across various DeFi protocols.

The total supply of USDf, a dollar-pegged stablecoin, has been on a steady upward trajectory for several months and now stands at $648 million. The total value locked (TVL) in the protocol is $685 million, representing the total value of crypto assets deposited by users. These assets are secured by a 115% overcollateralization rate, which is fully verifiable through daily reserve attestations.

The increasing demand for USDf can be attributed to the strong uptake of the Falcon Miles points program, which offers enhanced transparency measures such as daily proof-of-reserve attestations and quarterly ISAE 3000 assurance reviews conducted by Harris & Trotter LLP. These measures have bolstered user confidence in the protocol.

The recent launch of the first onchain mint using tokenized U.S. Treasuries via Superstate’s USTB has successfully bridged real-world assets with DeFi liquidity. Additionally, a partnership with BitGo provides secure institutional custody, paving the way for fiat ramps and staking integrations. Falcon has also expanded its cross-chain presence to XRPL EVM via Axelar and BNB Chain, enhancing capital efficiency across the multi-chain landscape.

Opportunities to utilize USDf have grown with integrations across various DeFi protocols, including a USDf spot market on WOO X and Pendle tokens like PT-sUSDf on Morpho’s lending and borrowing platform. This allows users to supply sUSDf as collateral while earning yield. After depositing stablecoins or crypto assets, including BTC and ETH, Falcon users can mint USDf, which serves as an overcollateralized stablecoin. Users who then elect to stake their USDf can mint a corresponding amount of sUSDf, the yield-generating version of Falcon’s dual-token stablecoin.

The yield available on sUSDf is variable but currently stands at an annual percentage yield (APY) of 10.8%. This yield is designed to remain competitive through diversified sources, including funding rate arbitrage, cross-exchange strategies, and now tokenized real-world assets. Unlike other synthetic dollar protocols that rely solely on positive funding rate arbitrage, the yield distributed to USDf stakers is derived from multiple sources. This ensures a consistent yield regardless of market conditions.

As part of its long-term user growth strategy, Falcon has expanded its Falcon Miles ecosystem-wide points program. This program rewards activity across minting, staking, liquidity provisioning (LPing), and referrals with up to 60x multipliers. The program includes retroactive drops and has extended to additional onchain integrations with platforms like Pendle, Euler, Morpho, Napier, and Spectra as the Falcon ecosystem continues to evolve.

With more chain integrations, additional vaults, and further expansions to Falcon Miles underway, Falcon Finance is rapidly advancing its goal of making USDf a cornerstone of the DeFi landscape.