Boundary Labs Raises $2M for USBD Institutional Stablecoin

Stablecoin startup Boundary Labs has raised $2 million in pre-seed funding led by Galaxy Ventures to develop USBD, a “verifiable” institutional stablecoin designed around onchain verification of reserves and net asset value. The round, which also included First Block Capital and BlackWood, began in late 2025 and closed in December, according to Boundary co-founder and CEO Matthew Mezger, a former Deutsche Bank and Digital Currency Group executive.

Funding Structure and Terms

The $2 million funding was structured as a simple agreement for future equity (SAFE) with token warrants, Mezger told The Block on Monday. No investor in the round has taken a board, advisory, or observer seat, he added. Mezger declined to disclose the valuation.

USBD Stablecoin Design

Boundary’s USBD is engineered around what Mezger called “continuous” onchain verifiability of reserves, net asset value, and protocol performance. “The Boundary protocol provides daily reporting on system state, including over-collateralization levels and real-time NAV calculations. USBD is engineered with explicit over-collateralization and delta-neutral hedging to protect against market direction risk and volatility,” Mezger said.

The stablecoin is designed to move the industry from monthly offchain attestations to daily onchain verification. “This shift provides the structural resilience and auditability required for safe, permissionless staking and institutional fiduciary use cases, effectively transforming stablecoins into robust financial infrastructure,” Mezger said.

Institutional Focus and Access

Boundary is focused on serving institutions, including asset managers, hedge funds, and family offices. Access to the protocol will happen through a dedicated application with know your customer and know your business verification workflows.

The company is planning a “private placement campaign” to onboard early institutional participants and has set a target of reaching $100 million in total value locked in 2026. “This phase focuses on building a robust, institutional-grade capital base for the protocol,” Mezger said.

Yield and Business Model

USBD itself will not be yield-bearing, but the protocol will offer a separate staked token called sUSBD, which will allow eligible institutional participants to earn protocol income generated through delta-neutral decentralized finance strategies.

Boundary’s business model is based on decentralized finance market mechanisms, including funding rates and basis arbitrage. “All protocol income must satisfy two core principles that insulate collateral from market direction risk: first, income-generating mechanisms must be delta-neutral; and second, the protocol cannot apply recursive leverage,” Mezger said.

Revenue generated by the protocol will be used to build treasury reserves, fund operations, and distribute yield to sUSBD stakers through an onchain allocation system. This differs from some synthetic dollar protocols where parts of the reward distribution process happen offchain and are harder for users to audit, Mezger added.

Launch Timeline and Team

Boundary plans to launch the protocol, including USBD and sUSBD, on the Ethereum mainnet in early summer 2026.

Besides Mezger, the other two co-founders of Boundary are Mathias NC and Roman Drapeko, who is the firm’s chief technology officer. Mezger said the team currently operates with a lean structure and is hiring in trading and research as it prepares for launch.