# How Re Is Turning Reinsurance Into a Stablecoin Yield Source *Author: David Christopher* *Published: Jun 18, 2026* *Source: https://www.bankless.com/es/read/how-re-is-turning-reinsurance-into-a-stablecoin-yield-source* --- Stablecoins started as trading collateral, then became payment rails. The next thing they may become is capital markets: large pools of liquidity routed into businesses that need it, returning yield to holders. That is the bet behind Re, the subject of this week's episode with founder [Karn Saroya](https://x.com/karnsaroya) and Electric Capital's [Avichal Garg](https://x.com/avichal). Re is an onchain *reinsurer* (more on this soon). Stablecoins go in, that capital helps back insurance companies, and premiums return to depositors. Karn says Re already backs 35 of them, does around half a billion in business, and expects to near a billion in the coming months. Crypto's at its best modernizing finance's oldest and most boring systems. This is one of them. > INTERVIEW: How Re is Rebuilding the $1T Reinsurance Market with Stablecoins | Karn Saroya & Avichal Garg[@re](https://x.com/re?ref_src=twsrc%5Etfw) is bringing the $1T reinsurance market onchain. Founder [@karnsaroya](https://x.com/karnsaroya?ref_src=twsrc%5Etfw) and [@ElectricCapital](https://x.com/ElectricCapital?ref_src=twsrc%5Etfw)'s [@avichal](https://x.com/avichal?ref_src=twsrc%5Etfw) join [@TrustlessState](https://x.com/TrustlessState?ref_src=twsrc%5Etfw) to unpack how stablecoins can become a new… [pic.twitter.com/3ifhfAFShl](https://t.co/3ifhfAFShl)— Bankless (@Bankless) [June 18, 2026](https://x.com/Bankless/status/2067578073134809332?ref_src=twsrc%5Etfw) ### **Insurance for Insurance** Reinsurance is very meta: it's insurance for insurance companies. Say an auto insurer sells thousands of policies. It collects premiums but takes on the risk that drivers crash and need paying out. To write more policies, reduce its risk, or prove to regulators it has enough capital behind those promises, it buys reinsurance. A reinsurer absorbs part of that risk in exchange for a cut of the premiums. It’s a market Karn pegs at roughly a trillion dollars in premiums a year. These are returns most people can't touch, having historically gone to pension funds, sovereign wealth funds, family offices, and institutions with the capital and access to play. But Re believes stablecoins, and their holders, could become a new capital source here, opening those gated premiums to onchain dollars. > Announcing a strategic investment from [@cbventures](https://x.com/cbventures?ref_src=twsrc%5Etfw).The venture arm of the largest US crypto exchange is backing Re, the onchain reinsurance capital marketplace.A real business now opening up onchain: $490M in premiums as of June 2026, policies covering nearly 1M households. [pic.twitter.com/XcWeg9FwVx](https://t.co/XcWeg9FwVx)— Re (@re) [June 17, 2026](https://x.com/re/status/2067246822616453610?ref_src=twsrc%5Etfw) ### **What Goes Onchain** Reinsurance is a promise backed by capital, and that promise is only as good as the money behind it. In the traditional system, that capital sits behind opaque balance sheets and murky plumbing. It’s not a setup that inspires trust. But put the capital layer onchain and that changes. Regulators, insurers, and depositors can *see* that the money behind the promise exists. This is how Re competes: cheaper capital formation, transparent infrastructure, and access to a new pool of onchain dollars. This reaches past reinsurance. DeFi's yields have increasingly been underpaying for the risk behind them, with [M0 founder Luca Prosperi](https://dirtroads.substack.com/p/68-the-physics-of-on-chain-lending)’s [pricing work showing protocols](https://www.bankless.com/read/can-defi-survives-mythos) don't compensate users for what they actually take on. Re's yield is priced differently, coming from insurance premiums and real-world demand for capital rather than token emissions or onchain activity. And its guardrails come from an already regulated industry rather than an onchain venue still finding its footing and riding DeFi's cycles. > rates in DeFi are too low for the level of risk$11.7B sitting in Morpho vaults today at 2-4% APY. retail is funding these markets via exchanges thinking it's a savings account. it's not. they're taking real credit risk on crypto-collateralized lendingno institution accepts… [pic.twitter.com/E6WlXnsf1W](https://t.co/E6WlXnsf1W)— Santiago R Santos (@santiagoroel) [April 6, 2026](https://x.com/santiagoroel/status/2041280267181232551?ref_src=twsrc%5Etfw) ### **Where RE Fits** If Re becomes the onchain capital marketplace for insurance it's aiming at, governance over that system becomes valuable. That's where the RE token comes in. RE determines which partners and counterparties it works with, which lines of business it supports, what capital requirements apply, how the pool is managed, and how the economics accrue. That is the token question at the center of the episode: if Re succeeds, how valuable does governance over that system become? > The Resilience Foundation is proud to announce the public launch of [$RE](https://x.com/search?q=%24RE&src=ctag&ref_src=twsrc%5Etfw).As [$RE](https://x.com/search?q=%24RE&src=ctag&ref_src=twsrc%5Etfw) goes live, key things to know:→ 95% of Season 1 participants are fully vested at TGE→ KYC applies to the top 5% of holders. The vast majority are already verified, and jurisdictional… [pic.twitter.com/5uk8lb1pa9](https://t.co/5uk8lb1pa9)— Re (@re) [June 18, 2026](https://x.com/re/status/2067595006257565921?ref_src=twsrc%5Etfw) The full conversation answers it, with more on Re's inner workings and why Avichal thinks this mullet architecture could define the next generation of fintech. If the thesis holds, Re marks crypto's entry into a new branch of finance, where opaque balance sheets give way to inspectable capital pools and gatekept yields flow to stablecoin holders rather than private institutions. [How Re is Rebuilding the $1T Reinsurance Market with Stablecoins | Karn Saroya & Avichal Garg on BanklessOnchain insurance![](https://storage.ghost.io/c/e4/b7/e4b77544-5a37-4f0b-8824-8440aa348476/content/images/icon/apple-touch-icon-f306715e-ba35-465e-9bf2-cfb1e46a482b.png)BanklessBankless![](https://storage.ghost.io/c/e4/b7/e4b77544-5a37-4f0b-8824-8440aa348476/content/images/thumbnail/how-re-is-rebuilding-the-1t-reinsurance-market-with-stablecoins-karn-saroya-avichal-garg-1781778763-15056842-f2aa-4e31-bcfd-90f94782a8df.png)](https://www.bankless.com/podcast/how-re-is-rebuilding-the-1t-reinsurance-market-with-stablecoins-karn-saroya-avichal-garg) --- *This article is brought to you by [Bitget](https://www.bankless.com/es/sponsor/bitget-1769543635?ref=read/how-re-is-turning-reinsurance-into-a-stablecoin-yield-source)*