Paradigm researchers aim to improve stablecoin pools via Orbitals as the market hits a record-high cap

Paradigm researchers think they have cracked the code for more efficient stablecoin pools, according to a new proposal called Orbitals. The proposed automated market maker (AMM) is designed specifically for pools of multiple stablecoins — from 2 to 3 "or 10,000 stablecoins," they write.

"Orbital unlocks capital efficiency by bringing concentrated liquidity to higher dimensions," researchers Dave White, Dan Robinson, and Ciamac Moallemi wrote in a blog on Monday.

Unlike existing decentralized trading solutions like Uniswap V3, which is limited to two-asset pools, and Curve, which supports multiple asset pools but constrains how liquidity providers can participate, Orbitals let liquidity pools customize their exposure to improve capital efficiency.

In other words, the idea is to address the limitations of current AMM infrastructure for large-scale stablecoin pools.

"Today, Orbital is just a design, but we're excited to see how it might change the stablecoin liquidity landscape," White wrote on X. 

The proposal arrives during renewed interest in stablecoins from both centralized and decentralized entities. Tech firm Meta is considering whether to implement stablecoins to help reduce international money transfer costs, while big banks compete with stablecoin issuers to have a say in stablecoin regulation. Even the first crypto startup to receive unicorn status in 2025 could be a stablecoin startup called Atticus.

What's more, the stablecoin market capitalization crossed $250 billion for the first time on June 2, thanks in part due to renewed DeFi interest, The Block previously reported.

Despite Orbitals proposing designs for thousands of stablecoins, two dominate the supply: Tether's USDT and Circle's USDC, which make up nearly 90% of the overall supply.