Wyoming’s ‘Frontier’ Stablecoin Debuts—Will It Offer Yield?

Four months after Wyoming’s stablecoin was introduced, the Cowboy State declared on Wednesday that its Frontier Stable Token is now available to the public.

As the first state-issued stablecoin in the U.S., the token that’s pegged to the dollar represents how private companies and governments both see opportunity in the technology, following the passage of landmark legislation for the sector this summer.

Although people close to the token’s creation have said that the stablecoin could offer a yield, a spokesperson for the Wyoming Stable Token Commission told Decrypt that the feature is still under consideration, and it isn’t currently present.

“We are exploring the possibility of providing yield, however it is not something we have at this stage,” they said.

Those close to the Frontier Stable Token, such as Wyoming Democratic State Senator Chris Rothfuss, argued in July that the token could offer yield to investors, despite restrictions in the GENIUS Act legislation passed this summer, because Wyoming is a state—not a business.

What’s more, the token’s backers have said the token will be distinct from other stablecoins offered by private companies, due to a “tall fence” between the state and federal government. Wyoming could push back against requests from federal authorities to seize or freeze funds on-chain, they said, while speaking as individuals.

Rothfuss told Decrypt on Wednesday that the state has put together an “truly exceptional” team to manage the token, but the group’s work is far from finished yet.

“We understand the incredible market demand for a yield-bearing [stablecoin], so we have talked about it internally, and are prioritizing work towards it,” he said. “We have to go through a series of steps to get there, and today is one of those big steps.”

Meanwhile, Wyoming said in a press release that the token’s reserves will be managed by Franklin Templeton, the global investment firm, which offers several crypto-focused exchange-traded funds. The firm also pioneered tokenized money-market funds.

“Our collaboration with the State of Wyoming demonstrates what’s possible when the public and private sectors work together to create a compliant, trusted framework for digital assets,” Franklin Templeton CEO Jenny Johnson said in a statement.

In August, the Wyoming Stable Token Commission said the state’s stablecoin would debut on Ethereum, Solana, and Avalanche,​​ as well as several Ethereum-based layer-2 scaling networks. The token is currently available for purchase on Wyoming-based crypto exchange Kraken, which moved its headquarters to the state from California in June.

Like most stablecoins, Wyoming’s token is backed by a combination of cash and U.S. Treasuries. The token’s operations leverage protocol LayerZero for cross-chain compatibility and digital asset infrastructure firm Fireblocks for security, Wyoming said.

Although most stablecoin issuers hold onto the yield that their tokens’ reserves generate, Wyoming plans to divert net revenue to the state’s School Foundation Fund quarterly. In a statement, Governor Mark Gordon lauded the initiative as innovative.

“By introducing the nation’s first state-issued stable token, we are demonstrating how thoughtful, transparent regulation and new technologies can be harnessed,” he said. “The launch of FRNT marks a defining moment in our state’s continued leadership.”

Rothfuss said that the Frontier Stable Token’s rollout might have felt drawn out to some, but he noted that the gears of government churn more slowly than for players in the private sectors.

“It might not feel like a short time from an industry perspective, but you have to look at this as a state activity,” he said. “This is the government, and to get the government to operate at the speed and efficiency that we operated was Herculean.”