Yield bearing stablecoin from USUAL protocol loses it's $1 peg

USD0++ a yield bearing stable coin from Usual Money’s staked USD0 slipped below $1 to $0.92 on decentralized exchanges due to concern over protocol's new dual exit plan's

Galvin Yu

• Updated: Friday, January 10, 2025, 13:03

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At a Glance

• USD0++ from Usual Money’s staked USD0 slipped below $1 to $0.92 on decentralized exchanges due to concern over new exit plan's.
• Sudden sell off millions of USD0++ by its holders, creating an imbalance over Curve pool led to the depeg.

USD0++ a liquid staked version of Usual Money's staked USD0 lost its peg of $1 USD to around $0.92 due to mixed reactions over the protocol's changed dual exit plan, which led to the selloff of USD0++ in millions creating a severe imbalance over the Curve pool.

USD0++ Price CoinGecko

This event has sparked discussions, analysis, and panic among cryptocurrency, defi traders and investors over the safety of funds in DeFi protocols.

USD0, a stablecoin issued by Usual Protocol, was designed to maintain a 1:1 peg with the US dollar through backing by real-world assets(RWA) like US Treasury bills which still holds the $1 peg.

USD0++, works like a zero-coupon bond which is lockedup for 4 years earning holder's USUAL, Usual’s native utility and governance token at the end of the term. Making the earnings of stakers completely dependent on the price of USUAL token at the time of redemption.

The community's response has been mixed. Some users on X have expressed frustration over the lack of clear communication from Usual Protocol regarding the changes to USD0++'s price floor mechanics. Others have defended the protocol, explaining that USD0++ was never intended to maintain a strict $1 peg due to its bond-like characteristics.

USUALUSUAL is a secure and decentralized Fiat Stablecoin issuer that redistributes ownership and governance through the $USUAL token.

Usual is a multi-chain infrastructure that aggregates the growing tokenized Real-World Assets (RWAs) from entities like BlackRock, Ondo, Mountain Protocol, M0 or Hashnote to transform them into a permissionless, on-chain verifiable, and composable stablecoin (USD0).

Usual is built around the redistribution of power and ownership to users & third parties, akin to a scenario where Tether’s TVL providers would own the company and the associated revenues.

USD0 is the first Liquid Deposit Token (LDT) offered by the Usual Protocol, representing a significant advancement in stablecoin technology. Backed 1:1 by Real-World Assets (RWA) with ultra-short maturity, USD0 ensures unparalleled stability and security.

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This article was originally published on: Jan 10, 2025 at 01:03 PM

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