Sonic Labs Introduces USSD, a Native Stablecoin Designed to Power the Sonic Ecosystem, Built by Frax

Sonic Labs announced the introduction of USSD, a U.S. Treasury–backed stablecoin designed to serve as the native source of stable liquidity across the Sonic network and support on-chain financial activity throughout its ecosystem. USSD is built on Frax’s GENIUS-compatible frxUSD stablecoin infrastructure, providing Sonic with a network-native stablecoin supported by institutional-grade backing.

USSD reserves are composed of tokenized Treasuries from leading financial institutions, including BlackRock, WisdomTree, and Superstate.  By leveraging Frax’s infrastructure, USSD brings transparent and scalable Treasury-based collateral to the Sonic ecosystem, intended to support lending, trading, and on-chain financial applications while aligning stablecoin usage with the network’s long-term growth.

USSD is backed by U.S. Treasury bills and is mintable 1:1 with USDC, enabling seamless conversion from USDC to USSD. Using Frax’s infrastructure, USSD can be redeemed back to USDC on any CCTP-supported chains, providing a familiar and reliable on and off-ramp for stable value within the Sonic ecosystem. Subject to applicable KYC/AML requirements and issuer approval, eligible users will be able to redeem USSD directly for U.S. dollars to their bank accounts. This launch represents the initial phase of a broader rollout to establish USSD as an aligned stablecoin supporting the vertical integration initiative on Sonic.

USSD is designed to be accessible from the outset, with users able to mint and use the stablecoin without caps as part of Sonic’s vertically integrated approach. Using Layer Zero interoperability, USSD enables users to mint USSD from over 10+ chains directly to Sonic. As USSD adoption grows, revenue generated through its issuance and usage is intended to flow back into the Sonic ecosystem, providing buybacks, incentives and more. It is important for Sonic’s long term value that new revenue streams beyond the S token are established and leveraged to support this growth.

Samuel Harcourt, Core Contributor at Sonic Labs, said: “USSD is a foundational step in our vertical integration initiative. USSD will enable Sonic to tap into institutional yield at the base layer and build a more resilient ecosystem with external incentives and buybacks. By introducing a network-native stablecoin backed by real-world assets, Sonic Labs is enabling stable liquidity that supports long-term growth while maintaining the transparency and reliability users expect.”

Sam Kazemian, Founder and CEO of Frax, said: “Sonic is building core primitives that prioritize their network’s capital efficiency. A native stablecoin is a foundational part of that. Frax white-label stablecoins like USSD are built from first principles to be fully backed, transparent, and to forward underlying Treasury yield back to DeFi partners. Our infrastructure gives Sonic a productive base asset with cross-chain reach, fiat on-ramps, and our five-year security track record.”

USSD will be available to users on the Sonic network beginning March 9, 2026, with further details regarding ecosystem initiatives to be shared in the coming weeks. To learn more, visit https://www.soniclabs.com/.

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