RWA Decentralization stablecoin: Usual Money and its innovative mechanism

Stablecoins are the cornerstone of the cryptocurrency industry, playing a key role in large-scale payments and industry adoption. As of the end of July 2024, the total market value of stablecoins reached 16.8 billion USD, with the two major stablecoins USDT and USDC accounting for about 90% of the market share.

The high concentration of the stablecoin market has sparked a demand for decentralized alternatives. Various decentralized stablecoin projects have emerged, including types such as over-collateralized, equal-collateralized, and under-collateralized. However, most of these projects rely on crypto assets as collateral, requiring complex mechanisms to cope with coin price fluctuations.

Usual Money provides an innovative solution by introducing real-world assets ( RWA ) as collateral. The project uses U.S. Treasury bonds as collateral, combining the transparency and security of Ethereum smart contracts to distribute profits to the community and contributors. This design is referred to as "on-chain Tether", which combines the 1:1 RWA characteristics of centralized stablecoins with the security and transparency advantages of blockchain.

Project Background

Usual Labs completed a $7 million funding round in April 2024, led by IOSG and Kraken Ventures. Founder Pierre Person previously served as a member of the French National Assembly and played a significant role in advancing legislation for crypto assets.

The project launched its mainnet on July 10, and by early August, the total locked value (TVL) reached $146 million. The USD0 stablecoin is primarily traded in Curve's USD0/USDC pool, with liquidity exceeding $11 million. In addition, the project has a vault managed by MEV Capital on Morpho, providing liquidity pools for USD0/USDC and USD0++/USDC.

Usual plans to conduct the token generation event (TGE) in the fourth quarter of 2024, with 90% of the USUAL tokens being allocated to the community.

Mechanism Analysis

collateral and minting

USD0 is the first RWA stablecoin that aggregates multiple U.S. Treasury bond tokens and can be minted in two ways:

1. Direct RWA deposits: Users deposit qualified RWA at a 1:1 ratio to receive an equivalent of USD0.
2. Indirect USDC/USDT deposit: Users deposit USDC/USDT and obtain a 1:1 ratio of USD0 through a third-party collateral provider.

This design enables Usual to seamlessly integrate RWA token liquidity from platforms like Hashnote, addressing the liquidity challenges that RWA faces in the cryptocurrency market.

Yield Mechanism

USD0++ is an enhanced locking version of USD0. Users can choose one of the following two income methods:

1. USUAL token rewards: Daily rewards in the form of USUAL tokens.
2. Basic interest guarantee: Lock USD0++ for a certain period (currently 6 months), ensuring a return of at least equivalent to the return on USD0 collateral.

Regardless of how USD0++ is obtained, holders are entitled to receive USUAL token rewards.

User Participation

Usual has launched the "Pills" campaign to encourage users to participate in the ecosystem:

1. Minting: Each time USD0 is locked for USD0++, you can obtain 5 Pills.
2. Holding: Holding USD0++ daily can earn 3 Pills.
3. Provide liquidity: Providing liquidity in Curve's USD0/USDC pool can earn 1 Pill per day.
4. USD0/USD0++ Pool: Contributing USD0 to this pool will earn you 3 Pills daily, and for each minted USD0++, you will also receive 5 Pills (distributed proportionally to USD0 LP in the pool).

The event also features a time multiplier, starting at 1 and increasing by 2% daily, while the exit position resets to 1.

In addition, Usual has launched the second phase of activities on the Galxe platform, where users can earn more Pills rewards by completing tasks.

Through these innovative mechanisms and incentive measures, Usual Money is striving to establish its unique position in the decentralized stablecoin market, providing users with more diversified choices.