I received a message from a friend in the middle of the night. This guy is never one to shout out random trading signals; whenever he actively reaches out to me, it’s usually not a good sign. He directly asked: Is there really a need for another USD stablecoin now? What’s the deal with Falcon Finance’s USDf?

I stared at the screen in a daze for a few seconds. To be honest, my first reaction was—there are already plenty of USD stablecoins on the market. Some are rock-solid veterans, some are emerging stars that occasionally shake things up, and others are just unstable coins that could collapse at any moment. So initially, I thought USDf was just another token to fill the space.

But the more I looked into it, the more interesting it became. The core competitiveness of USDf actually lies in its composability. It sounds fancy, but that’s basically it—like LEGO bricks, it can seamlessly integrate into various DeFi applications. It’s not meant to be a flashy collectible, but a fundamental component. Once a stablecoin can connect smoothly with other protocols, it evolves from a simple token into a bridge, a connector, and even an invisible infrastructure for the entire system.

Falcon Finance’s ambition is to make USDf a kind of USD tool that flows freely between different applications—ordinary but essential—maintaining a stable value of one dollar even when surrounding assets fluctuate wildly.

Looking at the lending market makes this clear. This is the area where stablecoins are most vulnerable to problems. Lending protocols are essentially shared pools of funds—one side is for depositing to earn interest, and the other is for borrowing and paying interest. To prevent the pool from collapsing, borrowers must provide over-collateralization. If the collateral value drops too much, the system automatically liquidates it to cover the debt. It seems stable on the surface, but the risk mechanisms behind it are the real key to survival.