Author: TechFlow
The value of Binance’s listing effect is still increasing.
In recent days, Binance’s sudden launch of ACT and PNUT has triggered multiple rounds of discussions and has also brought a considerable wealth effect to everyone.
Today, according to the official announcement, Binance will list Usual (USUAL) on Launchpool and Pre-Market. USUAL will be listed on Pre-Market at 10:00 (UTC) on 2024-11-19. Launchpool will start at 00:00 (UTC) on 2024-11-15.
Among them, the total amount of USUAL is 4 billion, and the initial circulation accounts for 12.37%, of which the total amount of Launchpool is 300,000,000 USUAL (7.5% of the maximum supply of tokens).
Compared to the unstable Meme, Usual is actually a stablecoin protocol.
You may ask, isn’t Meme the main theme now? What’s so special about this kind of token? Will it follow the same path as VC coins?
Of course, the top CEXs will not only choose Meme to go online. In essence, any coin with a good enough narrative and enough secondary space is likely to be favored.
If you want to participate in Usual, you may want to take a look at the following interpretation to quickly understand everything you may need to know about the agreement.
Why do we need a stablecoin?
First of all, let’s clarify two positions. Usual is a stablecoin protocol. Its USD0 is a permissionless and fully compliant stablecoin that is 1:1 backed by real-world assets (RWA);
The USUAL token itself is the project’s governance token, allowing the community to guide the future development of the network.
Following these two positionings, you can quickly understand what Usual is doing.
Everyone knows that the current stablecoin market is already quite mature, and the status of Tether and Circle is unbreakable. So what is the necessity for the existence of a new stablecoin?
In other words, what is a viable narrative for a stablecoin newcomer? The answer starts with three real-life observations.
First, in 2023, Tether and Circle generated more than $10 billion in revenue, and their valuations exceeded $200 billion. However, users who contributed liquidity to them failed to share these huge profits. This model of centralized institutions privatizing profits and socializing risks runs counter to the original intention of decentralized finance.
Secondly, although real world assets (RWA) have attracted much attention in the crypto market, even products such as on-chain U.S. Treasury bonds have less than 5,000 holders on the mainnet. This shows that the deep integration of RWA and DeFi still faces many challenges.
Third, DeFi users generally want to share in the success of the projects they support. However, the existing profit distribution model often ignores the greater risks taken by early users and fails to fully incentivize participants who contribute to the success of the project.
So this narrative points to democracy and equal rights.
It is based on these observations that Usual came up with three selling points of its own:
The first is to move the stablecoin completely onto the chain. Unlike traditional stablecoins, the issuance of Usual is completely controlled by the community holding governance tokens, including important decisions such as risk policy, collateral nature, and liquidity incentive strategy. This decentralized control ensures the neutrality and transparency of the protocol.
The second is to solve the bankruptcy isolation problem. The reserves of traditional stablecoins are often stored in commercial banks, which exposes them to the partial reserve risk of the banking system. As revealed by the collapse of Silicon Valley Bank, this model has systemic risks. Usual takes a different approach and directly links to ultra-short-term bonds, supplemented by strict risk policies and insurance funds to ensure 100% collateralization of assets.
Finally, it is to redefine the ownership and income distribution mechanism of stablecoins. Users can not only obtain the income generated by stablecoin collateral, but more importantly, gain complete control over the protocol, treasury, and future income through governance tokens.
In essence, the emergence of Usual is not to simply compete with existing stablecoins. It attempts to solve a more fundamental problem: how to make stablecoins truly become users' own financial infrastructure rather than a profit tool for a centralized institution.
Ususal's USD0, a stablecoin backed by RWA
The Usual Protocol ecosystem is mainly composed of three core products: USD0, USD0++ and USUAL governance tokens. Each product has its own unique functions and value propositions, which together form a complete financial ecosystem.
USD0: A secure and stable foundation
USD0 is the cornerstone of the Usual ecosystem. It is the world's first RWA stablecoin that aggregates multiple U.S. Treasury tokens. This design makes USD0 a safe, bankruptcy-isolated solution that does not rely on traditional bank deposits, thus avoiding the systemic risks that may arise from the traditional financial system.
The reason why USD0 has a zero is because it wants to be the equivalent of central bank currency (M0) in the monetary agreement.
The main features of USD0 include:
Fully transferable and permissionless: ensuring seamless integration and broad accessibility in the DeFi ecosystem.
Versatility: Can be used as a payment instrument, counterparty, and collateral.
Transparency: Provide up-to-date collateral information in real time to enhance user trust.
Scalability: Since it is backed by the deep and liquid U.S. Treasury market, it can theoretically expand to a trillion-dollar scale.
USD0++: An innovative product that doubles government bond returns
USD0++ is an innovative product in the Usual ecosystem, essentially an enhanced treasury bond. Through an enhanced 4-year DeFi treasury bond, secured by the principal locked as USD0 for 4 years, the principal can be recovered. It allows users to benefit from the growth and success of the protocol. Unlike traditional models, USD0++ not only provides protocol income, but also distributes ownership of the protocol through its innovative reward mechanism.
There is profound financial wisdom behind this innovative design. When users convert USD0 to USD0++, they actually enter a carefully designed two-tier income structure. The first layer is the basic income from US Treasury bonds, which is guaranteed by the Basic Interest Guarantee (BIG) mechanism to ensure that investors can get returns equivalent to ordinary Treasury bonds even in the worst case. The second layer is the enhanced income brought by the development of the protocol, which is distributed in the form of USUAL tokens.
It is worth noting that the lock-up period of USD0++ is set to 4 years, and this time span is not chosen randomly. It not only matches the maturity of US medium-term treasury bonds, but also gives the protocol enough time to develop and create value. During these 4 years, USD0++ holders have actually become long-term partners of the protocol, and their interests are closely tied to the growth of the protocol.
From the perspective of technical implementation, USD0++ adopts the method of automated management by smart contracts. When users deposit USD0, the contract will automatically allocate funds to the optimal treasury bond portfolio and start the token issuance plan at the same time. This process is completely transparent and cannot be tampered with. Users can check their investment status and expected returns at any time. More importantly, the entire system adopts a modular design, which means that parameters can be flexibly adjusted or new functions can be added in the future according to market demand and regulatory requirements.
Compared with the traditional financial market, the innovation of USD0++ lies in that it successfully transforms passive treasury bond investment into active protocol participation. Investors are no longer just waiting for interest to expire, but can participate in protocol governance through USUAL tokens, share growth dividends, and even trade these rights in the secondary market. This design essentially creates a new category of financial products, which not only retains the security of treasury bonds, but also gives the crypto economy growth potential.
From a risk management perspective, USD0++ provides a unique risk hedging solution. In an environment of volatile crypto markets, investors can obtain stable cash flow from government bonds while sharing industry growth through USUAL tokens. This combination strategy effectively balances risk and return. Especially in periods of market downturns, the basic interest protection mechanism can provide important downside protection, while in periods of market upturns, USUAL tokens provide considerable upside potential.
USUAL: The core of governance and incentives
As the governance token of Usual Protocol, USUAL is designed to be more than a simple voting token. It is the core of value capture and distribution in the entire ecosystem, ensuring the sustainable development of the protocol and maximizing user benefits through a carefully designed token economics model.
In terms of governance, USUAL adopts an innovative "value-oriented governance" model. Holders can not only participate in important decisions of the protocol, such as risk parameter adjustments, new product launches, etc., but more importantly, their voting weight is directly linked to their contribution to the protocol. This mechanism ensures that users who hold for a long time and actively participate in ecological construction can gain greater voice.
USUAL's value capture mechanism is built on multiple levels. First, all revenue generated by the protocol, including minting fees, redemption fees, etc., will be used to support the value of USUAL. Second, through the staking mechanism, USUAL holders can obtain continuous profit sharing. More importantly, as the scale of assets managed by the protocol grows, the issuance speed of USUAL will gradually decrease. This deflationary design ensures the long-term value growth potential of the token.
In practical applications, USUAL's functions have extended to multiple areas beyond governance. It can be used as a reward token for liquidity mining, participate in the pricing of various financial products in the ecosystem, and even serve as a medium for cross-chain bridging. This multi-dimensional practicality not only increases the demand for tokens, but also strengthens the network effect of the entire ecosystem.
Through this all-round design, USUAL has successfully linked all components of the protocol together to form a self-reinforcing positive cycle system. With more users participating and assets accumulating, USUAL's value proposition will become clearer and stronger.
Outlook
Judging from the current market environment, Usual's launch timing can be said to be just right. As the crypto market gradually recovers from the bear market, the demand for high-quality projects is rising. Unlike Meme coins that purely pursue short-term speculation, Usual provides a complete financial infrastructure solution, and this differentiated positioning may become its unique advantage.
From a valuation perspective, we need to focus on several key dimensions:
First, the overall space of the stablecoin track. Currently, the combined market value of USDT and USDC exceeds $100 billion, with an annualized return of more than $10 billion. If Usual can obtain 5% of the market share, the stablecoin business alone can support a considerable valuation.
Second is the growth potential of the RWA track. As traditional financial institutions gradually enter the crypto market, the demand for compliant on-chain treasury bond products will increase significantly. As the first protocol to tokenize Treasury bond proceeds, Usual is likely to become an important player in this emerging market.
Looking at the market performance after Binance listing, recent cases show that the market is still enthusiastic about pursuing high-quality projects (whether or not it is a meme, quality has a unique narrative component). Usual has a complete product matrix, a clear value capture model and a broad market space, all of which are highly consistent with the characteristics of a successful listing project.
However, investors also need to pay attention to several key risk points:
The first is regulatory risk. Although Usual uses compliant government bonds as backing, any innovative financial product may face policy uncertainty amid tightening global financial regulation.
The second is the cost of market education. Although the model of combining stablecoins, treasury bond returns and governance tokens is innovative, it also increases the difficulty for users to understand. The project team needs to invest a lot of resources in market education.
The third is competition risk. Once Usual proves that this model is feasible, it will inevitably attract more teams to join. How to maintain the first-mover advantage will be a continuous challenge.
In general, Usual represents an important exploration direction in the DeFi 2.0 era. It does not simply copy the existing model, but tries to solve practical problems through technological innovation. For investors seeking long-term value, this is undoubtedly a project worth paying attention to. But at the same time, investors also need to reasonably allocate positions and do a good job of risk management according to their own risk tolerance and investment cycle.
