Author: Ignas | DeFi

Compiled by: Deep Tide TechFlow

The stablecoin market has surpassed $100 billion, but much of that value is controlled by centralized giants like Tether and Circle, with regular users unable to benefit.

In this market cycle, we have seen the rise of Ethena, and now Usual has also joined the competition.

Usual is a decentralized, transparent, and community-driven stablecoin protocol.

Usual launched USD0, a stablecoin backed by fiat currency and collateralized by ultra-short-term US Treasury bonds.

Recently, they partnered with Ethena, allowing users to use USDtb as collateral for USD0.

Additionally, the protocol offers a 1:1 exchange mechanism between USDtb, USD0, and sUSDe.

(Tweet details)

Usual also launched USD0++, a liquid staking token that earns rewards by staking USD0.

Users can earn daily through USD0++, with earnings in the form of $USUAL tokens or risk-free USD0.

The current annualized yield is as high as 80%.

$USUAL brings new innovations in token economics:

  • It represents 100% ownership of the protocol's revenue.

  • Holders enjoy governance rights over the treasury and protocol decisions.

  • Holders can also share in the future growth dividends of the protocol.

Unlike utility tokens with low circulation and high fully diluted valuation (FDV), Usual's token economics focus more on community distribution:

  • 90% of $USUAL will be allocated to the community, including users, liquidity providers, and contributors.

  • Only 10% is allocated to insiders (team and investors).

  • $USUAL holders will control the treasury and major decisions of the protocol.

$USUAL's issuance mechanism is dynamic and directly linked to the actual revenue of the protocol.

New $USUAL is minted and distributed daily based on the protocol's revenue.

As the total locked value (TVL) of USD0++ grows, the issuance rate of $USUAL will gradually slow down.

Although the official documentation claims the token is not inflationary, in reality, $USUAL is inflationary.

The solution is to stake $USUAL as USUALx, which can earn 10% of the protocol's daily minting total.

If unstaking, a 10% penalty will be charged, half of which will be rewarded to other USUALx stakers.

The current annualized yield is as high as 1737%.

The maximum distribution of $USUAL occurs during the initial airdrop phase (which I completely missed).

As time goes by, the token issuance rate will gradually slow down, so early participants have more advantages; the key is to enter early and anticipate the growth of TVL.

The longer the time, the more apparent the dilution effect of the tokens.

The good news is that the collaboration with Ethena will help drive rapid growth in TVL.

Disclaimer: I have not received any compensation for this article!

However, it is indeed exciting to see innovative projects like Ethena and Usual challenge USDT and USDC. These traditional stablecoin giants do not share profits with users, while new projects are changing this situation.

Now, we have two alternative options worth paying attention to for betting on further growth in the stablecoin market.

If I have any incorrect information, please feel free to point it out!

I am still researching this protocol and, as usual, recording my understanding while learning!