Announcement

1- Early USD0++ Unstaking is Now Available: Users can now unstake their USD0++ for USD0 on a 1:1 basis before the end of the locking period by contributing $USUAL tokens.

• The $USUAL contribution is dynamically adjusted based on the net of USD0++ minted and USD0++ unstaked over a rolling 7-day period.

• The $USUAL contribution for unstaking is capped at the equivalent of 6 months of $USUAL rewards at the current daily rewards rate per USD0++.

• Contributed $USUAL tokens are either burned (33.33% of contributions) or redistributed (66.67% of contributions) to long-term holders through $USUALx and $USUAL*, promoting greater stability for the protocol.

2- Introducing the iUSD0++ sUSDEe Vault: Maximize the value of your USD0++.

• Deposit USD0++ in the iUSD0++ vault and gain simultaneous exposure to USD0++ yield and sUSDe yield.

• All USD0++ deposited will be temporary withdrawn via primary market redemption for USD0 and subsequently swapped for sUSDe for deposits to the vault.

• Earn $USUAL token rewards as if you were holding USD0++, plus receive additional sUSDe yields, unlocking new farming opportunities.

• Going live next week. New vaults incoming soon.

3- New Liquidity Pool for USD0++/USD0: Usual will introduce a new USD0++/USD0 liquidity pool incentive to enhance market efficiency. This pool is specifically designed to promote liquidity within the anticipated USD0++ price range above the price floor, ensuring better balance for LPs and facilitating USD0++ price discovery. Stay tuned for updates in the coming days.

USD0++ Early Redemption Mechanism with USUAL Burning

Context

USD0++ is a Liquid Staked Token representing USD0 locked until maturity (June 30, 2028). This system encourages long-term commitment by allowing users to earn USUAL tokens while generating yield for the protocol and USUAL holders.

While users can sell USD0++ on the secondary market, they can also exchange 1 USD0++ for 1 USD0 at any time by providing a specific amount of USUAL tokens. This mechanism reduces the total supply of USUAL, enhancing its valuation and increasing staking rewards for holders.

Additionally, exiting USD0++ into USD0 can enable arbitrage, allowing a more efficient and liquid market for USD0++.

How Does It Work?

1. Direct Redemption

Users can exchange 1 USD0++ for 1 USD0 at any time by returning a specific amount of USUAL tokens.

2. Calculation of Required USUAL

The amount of USUAL required by the redeeming user depends on:

• Daily Rewards Rate: The current daily USUAL rewards rate per USD0++.

• USD0++ Redemption Activity vs DAO Target: The weekly redemption activity across the protocol, calculated on a rolling 7-day basis compared to a weekly redemption target (0.3% of USD0++ supply).

• Max Duration Cost: The max days chargeable based on the current daily rewards rate (set to 180 days).

3. Distribution of Required $USUAL.

Once returned, $USUAL is either burn or allocated within the ecosystem as follows:

• 33% burned: Reduces the total supply of $USUAL.

• 67% allocated to $USUALx and $USUAL*: Rewards long-term commitment.

Ultimately, as more redemptions (USD0++ unstaking) occur, the cost in $USUAL is meant to increase until it reaches a capped 180 days of USUAL at the current rewards rate. Therefore, the cost differs in different scenarios, which can further be depicted by the following example:

• Example: If a user redeems 500,000 USD0++, at a minimum, he will need to return 9,000 USUAL (11% of the max cost of 81,000) if the net weekly redemption for USD0++ are 0 or less.

Evolution and Automation

Currently, early unstaking is not fully automated and will receive manual updates following the formula outlined in the dedicated papers.

Over time, this process will become fully automated as in determined by the community, ensuring smooth and responsive management. As for distribution of $USUAL to USUALx and USUAL*, just like the $USUAL contributed through $USUALx unstaking, the DAO team will redistribute them at regular intervals via a disperse system until the mechanism is fully established. Overall, the mechanism can be improved and community input will be sought to enhance the product.

Why Is This Mechanism Beneficial?

1. For Users: It provides a guaranteed exit option, even during secondary market volatility.

2. For the Ecosystem: Burning USUAL reduces its total supply, increasing its value for remaining holders and USUALx stakers.

3. For the Protocol: It balances supply and demand of USD0++ while fostering long-term user commitment.

This mechanism offers flexibility for users while ensuring the stability and sustainable growth of the Usual protocol.

You can refer to the research paper for more details.

iUSD0++ Vault - Creating Exposure to USD0++ sUSDe

Usual is introducing the iUSD0++ vault that enables USD0++ holders to gain exposure to various ecosystem assets. The first live vault will focus on sUSDe, allowing users to deposit their USD0++ and exchange them for sUSDE (allowing primary market redemption of USD0++). Users will continue earning USUAL rewards as if holding USD0++ while also receiving yield in sUSDE (for which the DAO takes a cut on).

This feature improves the composability of USD0++ and enables users to adjust its collateral exposure, providing an opportunity for DAO revenue to become more diversified and grow. New vaults beyond this first sUSDe compatible vault will be announced soon.

How Does It Work?

1. Deposit: Users can deposit USD0++ into the vault. This USD0++ will be subsequently unstaked for USD0 (at no additional cost) and swapped to sUSDe, which is then maintained in the vault.

2. Rewards: For each USD0++ deposited, the equivalent amount of sUSDe after swaps will be earning $USUAL rewards in addition to some sUSDe rewards. The DAO will take a cut of sUSDe rewards (which will be announced after the launch of this vault).

3. Withdrawal: Upon withdrawal, all sUSDe will be swapped back to USD0 and minted back to USD0++ through the primary market (replicating the reverse of the deposit operational flow).

Why Is This Mechanism Beneficial?

1. For Users: It provides rewards exposure to both sUSDe and Usual while allowing the user to change their collateral exposure.

2. For the Protocol: sUSDe yield collected by the DAO allows the treasury to further diversify its holdings while creating additional revenue streams.

This mechanism offers a new option for users that can foster new growth and engagement within the Usual ecosystem;

Release Date

First iUSD0++ vault compatible with sUSDe will be going live end of next week. Additional vaults beyond this will be incoming soon.

New Liquidity Pool mechanism for USD0++/USD0

With the recent introduction of the new price floor for USD0++, exit liquidity for USD0++ has been heavily impacted. Since the launch, residual liquidity in the USD0/USD0++ pool has consistently remained below 20 million USD0, driven by significant sell-offs and liquidity withdrawals since last Friday. Despite offering higher APYs than USD0++, the USD0/USD0++ pool has struggled to attract additional liquidity under these conditions.

To address this challenge, Usual is introducing a new incentive program for the USD0++/USD0 liquidity pool to boost market efficiency. This initiative is designed to encourage liquidity provision within the anticipated USD0++ price range above the price floor, ensuring a more stable balance for liquidity providers (LPs) and facilitating robust USD0++ price discovery.

Stay tuned for further updates in the coming days!