A pioneering DeFi 2.0 coin containing profound financial wisdom:
It should be understood that $USUAL is a stablecoin protocol, where USD0 is a permissionless and fully compliant stablecoin, supported 1:1 by real-world assets (RWA);
The USUAL token itself is the governance token of the project, allowing the community to guide the future development of the network.
Everyone knows that currently, Tether and Circle's positions are irreplaceable, so what is the reason for the existence of a new stablecoin?
First, in 2023, Tether and Circle generated over 10 billion USD in revenue, with valuations exceeding 200 billion USD. However, users who provided liquidity to them cannot share in these massive profits. This model of centralized organizations, where profits are privatized while risks are socialized, contradicts the original goals of decentralized finance.
Secondly, although real-world assets (RWA) are attracting attention in the cryptocurrency market, even products like US government bonds on-chain have not reached 5000 holders on the main network. This indicates that the deep integration of RWA and DeFi still faces many challenges.
Thirdly, DeFi users often wish to share in the success of the projects they support. However, the current profit distribution model often overlooks the greater risks that early users have to bear and does not sufficiently incentivize participants who have contributed to the project's success.
Therefore, this story aims for democracy and fairness.
It is precisely based on these observations that $USUAL has presented its three unique selling points:
1. First, is the complete transition of stablecoins on-chain. Unlike traditional stablecoins, Usual's issuance is entirely controlled by the community holding governance tokens, including important decisions such as risk policies, the nature of collateral assets, and liquidity incentive strategies. This decentralized control ensures the neutrality and transparency of USUAL.
2. Secondly, it is about addressing the issue in the event of bankruptcy. The reserves of traditional stablecoins are often held at commercial banks, which makes them vulnerable to risks from the banking system. As the collapse of Silicon Valley Bank has shown, this model carries systemic risks. Usual has found another approach, directly linking to short-term bonds, combined with a strict risk policy and insurance fund, ensuring assets are 100% collateralized.
3. Third, is redefining stablecoin ownership and profit distribution mechanisms. Users can not only receive profits from the collateral assets of the stablecoin but more importantly, through governance tokens, they have complete control over usual, profits, and future revenues.
In essence, the emergence of Usual is not simply about competing with existing stablecoins; it seeks to address a more fundamental issue: How can stablecoins truly become the financial infrastructure for users, rather than merely a profit tool for some centralized organization?
Understanding USD0 of Usual right away, is a stablecoin backed by RWA
The ecosystem of the Usual Protocol mainly consists of three core products: USD0, USD0++, and the USUAL governance token. Each product has its own functions and values, together forming a complete financial ecosystem.
USD0: A safe and stable foundation
USD0 is the foundation of the Usual ecosystem; it is the world's first RWA stablecoin that synthesizes multiple types of US government bonds. This design makes USD0 a safe, bankruptcy-isolated solution that does not rely on traditional bank deposits, thereby avoiding systemic risks that may arise from the traditional financial system.
USD0 is assigned the number 0 because it aims to be equivalent to central bank currency (M0) in monetary protocols.
The main features of USD0 include:
Fully transferable and permissionless: ensuring seamless integration and wide accessibility within the DeFi ecosystem.
Multifunctionality: can be used as a payment tool, trading partner, and collateral asset.
Transparency: providing the latest information on collateral assets in real-time, enhancing user trust.
Scalability: due to the US government bond market with deep liquidity, theoretically, it can scale to trillions.
USD0++: An innovative product that doubles bond returns
USD0++ is an innovative product in the Usual ecosystem, essentially a type of enhanced government bond. Through a 4-year enhanced DeFi bond, secured by USD0 capital locked for 4 years, it ensures recoverable capital. It allows users to benefit from the development and success of the agreement. Unlike traditional models, USD0++ not only provides income from the agreement but also distributes ownership rights of the agreement through its innovative reward mechanism.
Behind this innovative design lies profound financial wisdom. When users convert USD0 into USD0++, they are essentially entering a carefully structured two-layer profit system. The first layer is the core profit from US government bonds, which is secured through the basic interest rate protection mechanism (BIG), ensuring that investors can receive returns equivalent to conventional government bonds even in the worst-case scenarios. The second layer is the enhanced profit from the development of the agreement, which is issued in the form of USUAL tokens.
Notably, the lock-up period for USD0++ is set at 4 years; this choice is not random. It aligns with the maturity timeline of US government bonds and allows the agreement sufficient time to develop and create value. During these 4 years, holders of USD0++ effectively become long-term partners of the agreement, with their benefits closely tied to the development of the agreement.
From a technical implementation perspective, USD0++ applies automated management through smart contracts. When users deposit USD0, the contract automatically allocates capital into an optimal government bond portfolio while initiating a token issuance plan. This process is entirely transparent and immutable, allowing users to monitor their investment status and expected returns at any time. More importantly, the entire system is designed in a modular fashion, meaning that in the future, parameters can be flexibly adjusted or new functions added according to market needs and management requirements.
Compared to traditional financial markets, the innovation point of USD0++ is that it has successfully transformed passive government bond investment into active agreement participation. Investors no longer simply wait for interest to mature but can engage in agreement governance through USUAL tokens, share growth profits, and even trade these rights in the secondary market. This design has essentially created a completely new type of financial product that maintains the safety of government bonds while granting the growth potential of the cryptocurrency economy.
From a risk management perspective, USD0++ provides a unique risk hedging solution. In a highly volatile cryptocurrency market, investors can receive steady cash flow from government bonds while sharing the industry's growth through USUAL tokens; this combined strategy effectively balances risk and return. Especially during market downturns, the basic interest rate protection mechanism can provide essential protection, while in bull markets, USUAL tokens will offer significant upside potential.
USUAL: The core of governance and incentives
USUAL, as the governance token of the Usual Protocol, its design goes beyond a simple voting rights token. It is the core of value capture and distribution throughout the ecosystem, through a carefully designed tokenomics model that ensures the sustainable development of the agreement and maximizes user benefits.
In terms of governance, USUAL adopts an innovative "value-based governance" model. Holders can not only participate in important decisions of the agreement, such as adjusting risk parameters, releasing new products, but more importantly, their voting weight is directly linked to their contribution level to the agreement. This mechanism ensures that long-term holders and active participants in building the ecosystem can have a greater voice.
The value capture mechanism of USUAL is set at multiple levels. First, all revenue generated by the agreement, including issuance fees, exchange fees, etc., will be used to support the value of USUAL. Second, through the staking mechanism, USUAL holders can receive continuous profit sharing. More importantly, as the scale of assets managed by the agreement increases, the issuance rate of USUAL will gradually decrease; this deflationary design ensures the long-term growth potential of the token's value.
In reality, the function of USUAL has expanded into many areas beyond governance. It can be used as a reward token for liquidity mining, participating in the pricing of various financial products within the ecosystem, and even as a bridging medium between chains. This multidimensionality not only increases the demand for the token but also reinforces the network effect of the entire ecosystem.
Through this comprehensive design, USUAL has successfully connected the components of the agreement organically, forming a self-reinforcing positive feedback system. As more and more users participate and assets continue to accumulate, the value that USUAL brings will become increasingly clear and powerful.
Prospects
From the perspective of the current market environment, the launch timing of Usual can be said to be very timely. As the cryptocurrency market gradually recovers from the bear market, the demand for high-quality projects is increasing. Unlike meme coins that purely pursue short-term speculation, Usual offers a complete financial infrastructure solution; this distinct positioning could become its unique advantage.
From a valuation perspective, we need to pay attention to several important aspects:
First is the overall space of the stablecoin sector. Currently, the combined market capitalization of USDT and USDC has exceeded 1 trillion USD, with annual revenues exceeding 10 billion USD. If Usual can capture 5% of that market share, the stablecoin sector alone could support a significant valuation.
Secondly, the growth potential in the RWA sector. As traditional financial institutions gradually enter the cryptocurrency market, the demand for legitimate government bond products on-chain will significantly increase. Usual, as the first protocol to convert government bond returns into tokens, is likely to become one of the key players in this emerging market.
Considering the market performance after listing on Binance, recent cases show that the market is still very interested in quality projects (whether they are memes or not, but with unique story elements). Usual has a complete product matrix, a clear value capture model, and a vast market space; these characteristics align well with successful projects at listing.
But investors also need to pay attention to some key risk points:
First is management risk. Although Usual has used compliant government bonds as collateral, in the context of tightening global financial regulations, any innovative financial product may face policy uncertainty.
Secondly is the cost of market education. The model combining stablecoins, bond returns, and governance tokens is innovative but also increases the difficulty for users to understand. The project team needs to invest many resources in market education.
Third is competitive risk. Once Usual proves this model feasible, it will certainly attract more teams to participate, and maintaining a first-mover advantage will be an ongoing challenge.
Overall, Usual represents an important direction in the DeFi 2.0 era. It is not merely a copy of existing models but seeks to address practical issues through technological innovation. For investors looking for long-term value, this is certainly a notable project. At the same time, investors also need to reasonably allocate their positions based on their risk tolerance and investment cycles, while implementing risk management.
