Generic Protocol launches GUSD and proposes private stablecoin

• GUSD bets on native privacy in stablecoins.
• The model redistributes revenue to apps and users.
• Regulatory debate in the US puts pressure on emitters.

Generic Protocol announced the launch of GUSD, described as the market's first natively private stablecoin, at a time of heightened regulatory scrutiny in the United States regarding how stablecoin rewards and yields should be structured. The project emerges as Congress debates limits on the distribution of returns, a topic that has divided industry companies and policymakers.

Built on the DeFi Morpho protocol, Generic operates as a “meta-stablecoin.” Instead of issuing its own traditional dollar, the system aggregates existing stablecoins, such as USDC, USDT, and USDS, and directs them to on-chain markets. The key difference lies in the yield routing: the generated returns do not remain with an issuer but are directed to the distribution layer, reaching applications, networks, and end users.

According to the team, the goal is to realign incentives throughout the entire stablecoin value chain. GUSD occupies a sensitive space in the current debate by combining privacy on public blockchains with a model that separates yield from asset control. The proposal seeks to reduce dependence on centralized issuers, a point frequently questioned by regulators and institutional participants.

Anthony Leutenegger, founder of Generic, stated that the protocol's neutral on-chain infrastructure was designed to support networks and dapps that use GUSD as their native stablecoin.

"This provides two clear advantages,"

he said.

“Firstly, because we are truly decentralized, we are not issuers and therefore have no control over issuance. Secondly, the income generated is decoupled from the asset itself; the integration partner can decide how to pass the income on to the ecosystem, which can also be done in a compatible, decentralized and programmatic way.”

Generic highlights that GUSD includes optional protocol-level privacy, allowing users to hide balances and transactions without hindering access to earnings. The non-custodial design on Ethereum features risk management and operational support from Steakhouse Financial. “This type of privacy is fundamental for payments,” stated Leutenegger, adding that “it improves speed and confidentiality without compromising compliance.”

The launch comes as US lawmakers assess whether stablecoin issuers can share rewards with users. The debate gained momentum after warnings from traditional banks about potential deposit migrations if remunerated stablecoins become commonplace. In this context, Generic's model seeks to treat stablecoins as composable inputs, directing returns to investments rather than corporate balance sheets, and positioning itself as technical infrastructure in the face of regulatory evolution.