Written by: Luke, Mars Finance
Recently, with Binance announcing the launch of Usual (USUAL), this stablecoin project called Usual Money has quickly become the focus. As one of the latest projects of Binance Launchpool and Pre-Market, Usual has attracted widespread attention from the market. The listing effect of Binance has undoubtedly increased the exposure of Usual, but the complex mechanism and unique innovations of this product are also worthy of our attention. This article will analyze the innovations and operating mechanisms of Usual Money in detail to help investors better understand the value of this project.
In the current stablecoin market, the market's attention to stablecoins is constantly increasing, especially in the context of payment giants such as Stripe acquiring stablecoin payment companies, and Coinbase CEO mentioning that the stablecoin transaction volume is close to Visa data. The launch of Usual Money undoubtedly has important market significance. In particular, as the regulation of the stablecoin market gradually becomes clear, Usual Money is becoming a potential leader in the future payment market with its innovative design and risk management mechanism.
Usual Money's core mechanism: a combination of innovation and robustness
The core mechanism of Usual Money revolves around three important tokens: stablecoin USD0, four-year bond product USD0++, and governance token Usual. These tokens not only innovate in stability and returns, but also achieve decentralized governance through smart contracts and governance tokens.
USD0 - the core support of stablecoins
USD0 is the basic stablecoin in the Usual Money ecosystem. It supports its value by holding real-world assets (RWA), similar to other RWA-secured projects such as FRAX and Grypscope. The underlying assets include U.S. short-term Treasury bonds and overnight reverse repo bonds, which ensure the stability of USD0 and can cope with the risks brought by market fluctuations.
Unlike existing stablecoins (such as Tether's USDT), which mainly rely on cash and short-term debt instruments, USD0 improves its stability and risk resistance through a diversified RWA asset pool. In addition, the issuance and repurchase mechanism of USD0 is automatically executed based on predetermined rules, reducing the impact of human factors on currency fluctuations. Therefore, USD0 not only has a strong anti-inflation ability, but also can remain relatively stable in large-scale market fluctuations.
USD0++ - Enhanced Bond Product
USD0++ is Usual Money's innovative bond product that allows users to obtain higher returns by locking USD0 assets. Compared with traditional treasury bonds, USD0++ enables users to enjoy higher returns by amplifying the returns of RWA assets. The design of this product improves the stability of the project while providing continuous incentives for long-term investors.
Specifically, the source of USD0++'s income directly corresponds to the RWA assets paid by users, rather than the average income of all reserves. This means that the income each user gets by converting funds to USD0++ depends entirely on the returns generated by the RWA (such as US Treasury bills) supported by these specific funds. Instead of aggregating the funds of all participants and evenly distributing the income of the entire reserve. Therefore, the user's income is directly linked to the RWA assets they lock up, which is more transparent and personalized. This means that participants can obtain corresponding income by holding USD0++, or choose to lock up for six months to further increase their returns. These income may be issued in the form of USD0 or Usual. Through these mechanisms, Usual Money makes users not only passive holders, but also part of the growth of the protocol.
There are two important purposes behind the design of USD0++: one is to enhance the long-term stability of funds and reduce short-term volatility risks through a locking mechanism; the other is to allow users to enjoy the potential value-added brought by the development of the protocol by holding USD0++. Throughout the process, the interests of users are closely linked to the development of the protocol.
Usual - Governance Tokens and Revenue Distribution
As a governance token, Usual tokens give their holders the right to influence decisions in the protocol, including risk management, liquidity strategies, and the development of new features. Additionally, a distinctive feature of the Usual token is that it is pegged to the protocol’s revenue – all protocol revenue from USD0++ will be distributed to Usual token holders. This makes the Usual token not only a governance tool, but also a representative of the protocol’s value growth.
The distribution and circulation mechanism of Usual tokens will be gradually adjusted according to the development of community governance, so that it can maintain a fair and effective incentive structure during the growth process. Especially in the early stage of the project, the distribution of Usual tokens is mainly concentrated on early investors and core team members, and as the protocol expands and the community grows, the release of tokens in the later stage will gradually slow down to ensure the balance of market supply and demand and avoid price fluctuations caused by oversupply.
Usual Money Token Economics Innovation
Usual Money’s token economics design demonstrates significant innovation and uniqueness. By separating the functions of stablecoins and governance tokens and employing complex incentive mechanisms to attract long-term user participation, the project ensures sustainable development.
Usual tokens are mainly used for governance and utility functions. It adopts a deflationary mechanism, where early participants receive more tokens, and as the total locked value (TVL) increases, the token distribution gradually decreases. Holders not only have control over the treasury, but also participate in the decision-making process. In addition, staking tokens not only supports the security of the protocol, but also generates returns. 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)
Unlike other protocols that allocate 50% of tokens to venture capitalists and consultants, Usual allocates 90% of tokens to the community, with internal team members allocated no more than 10% of the circulating supply. In the current growing call for "fairness", this practice highlights Usual's emphasis on the "decentralized" spirit of the community.
Inflation Control and Market Stability
Unlike traditional stablecoins such as Tether and Circle, Usual Money separates the stablecoin (USD0) and the governance token (Usual), avoiding the concentration of returns and risks in the same token. This design not only reduces risk, but also enables Usual to be directly linked to the protocol revenue distribution, providing users with higher long-term returns. Through sophisticated asset allocation and governance mechanisms, Usual Money is able to control inflation and effectively incentivize community participation. In particular, in the distribution of Usual tokens, by linking to protocol revenue, a dynamic reward mechanism is created that closely links the token value with platform growth and stability.
The supply of Usual tokens will gradually increase in the early stages of the protocol, but over time, the supply growth will gradually slow down, and even reduce the market circulation through buybacks and destruction to maintain token scarcity. In terms of stability, Usual Money regularly discloses its balance sheet and financial status to ensure that each USD0 issued is backed by real-world assets. This transparency not only enhances user trust, but also helps market participants better understand the health of the protocol. In order to avoid the impact of fluctuations in a single asset class on stablecoins, Usual Money has adopted a diversified RWA investment strategy. In addition, the project party will adjust its strategy in a timely manner according to market changes to ensure the long-term stability of the protocol.
Market liquidity and incentives
Usual Money maintains market liquidity through multiple channels and incentivizes users to participate in the long-term development of the protocol. Its market liquidity strategy includes:
Liquidity pool: Collaborate with multiple decentralized exchanges (DEX) to create liquidity pools to ensure market liquidity for USD0 and USD0++. These liquidity pools reward liquidity providers with Usual tokens and part of the transaction fees to ensure market activity.
Liquidity provider incentives: A dedicated reward mechanism is established to issue Usual tokens to liquidity providers based on the liquidity share provided. This incentive model promotes Usual Money's liquidity management and helps maintain the liquidity of its stablecoin and bond products in the market.
Combination of short-term and long-term incentives: Combining short-term and long-term incentives to ensure that early participants receive adequate returns, while encouraging long-term investors to continue to participate through lock-up and profit distribution mechanisms.
Comparing the advantages of Tether and Circle Although existing stablecoins such as Tether and Circle have achieved certain success, they still face many challenges, especially in terms of transparency, resistance to bank runs and risk management. Usual Money solves these problems through transparent design, decentralized governance mechanism and innovative profit distribution methods, providing users with a more robust and scalable stablecoin solution. Especially in recent years, during the SVB crisis and the turbulent fluctuations in the crypto market, Tether and Circle's stablecoins face liquidity risks and credit issues. By eliminating the reliance on a single asset, Usual Money has established a more stable and transparent multi-asset endorsement structure, enabling it to better maintain stability during market turmoil.
Market opportunities and team background
The market potential of Usual Money lies in its response to the demand for stablecoins. As the stablecoin market matures and the regulatory framework becomes clearer, Usual Money, as a risk-free and scalable stablecoin solution, is expected to become the core infrastructure of blockchain payments in the future.
Team and Vision:
Pierre Person, the founder of Usual Money, was once an important figure in French politics. He served as a member of the French National Assembly from 2017 to 2022. He has a close relationship with President Macron and is an important member of his campaign team. Considering the current political situation in France and the defeat of the establishment in the election, Person's choice to switch to the blockchain field is a wise move. Such a political background undoubtedly adds a lot of chips to the project, and also allows us to see his far-reaching expectations for the project.
In addition, the team also closely monitors changes in the global regulatory environment and incorporates them into the project's strategic planning to ensure that Usual Money can develop healthily under the future compliance framework. Their goal is to make Usual Money a new benchmark in the global stablecoin market through innovative technology and compliant design.
Market demand and growth opportunities:
As the market demand for stablecoins continues to increase, Usual Money is designed to meet trillions of dollars of market demand in the future. Especially in the field of global payments and decentralized finance (DeFi), Usual Money's innovative model enables it to stand out from traditional financial infrastructure and become the gold standard in the stablecoin market.
Against the backdrop of increasing standardization in the blockchain and cryptocurrency industry, Usual Money, with its transparent and decentralized design concept, is able to attract the attention of traditional financial institutions and large investors, providing strong support for its growth in the market.
Opportunities to participate
Usual Money has demonstrated great potential in the field of stablecoins through its unique design concept and innovative token economics. Compared with traditional stablecoins such as Tether, Usual Money is not only more stable, but also realizes a long-term sustainable incentive mechanism by separating the functions of stablecoins and governance tokens.
For ordinary investors, in the era of low interest rates in the United States, RWA (real world asset) yields tend to decline, and investing in USUAL tokens has more potential than buying USD0++. **USD0++'s income mainly comes from treasury bonds and short-term debt instruments, and its returns are subject to market interest rates. The low interest rate environment directly leads to a shrinking return. Although USD0++** provides stable returns, its yield is difficult to effectively increase during low interest rates, and may even be lower than other investment options with greater growth potential.
In contrast, the value of USUAL tokens is closely related to protocol growth, market demand and governance mechanisms, and has greater adaptability and growth potential. Even in a low-interest environment, the value of USUAL tokens can still be driven by factors such as community governance, protocol revenue distribution and market expansion. Therefore, holding USUAL tokens may be a more suitable participation posture for ordinary investors.
In the end, Usual Money undoubtedly provides an opportunity worthy of attention and participation. In the fierce competition in the future stablecoin market, Usual Money may become a new benchmark in this field with its innovation and robust design.
