From Issuer to Infrastructure: Circle and the Economics of the Digital Dollar

Stablecoins offer an unusually clean value proposition in crypto: a programmable dollar that settles in seconds and can be transferred globally 24/7. Stablecoin adoption has only grown stronger as DeFi shifts toward a more institutional focus, with the combined supply of dollar stablecoins over $300 billion at the time of writing. The large and growing basket of assets backing stablecoins has made issuers into meaningful buyers of U.S. Treasury bills.

Their business model is very simple. In Circle's example, you give them cash, they invest it in short-term Treasuries to earn interest on your money, and in return they give you tokens redeemable for the underlying cash, without any of the interest attached.