Overview
Usual Money is a decentralized stablecoin protocol built around USD0, a stablecoin backed by short-term US Treasury bills and other RWA collateral. The core innovation is that the yield generated by the backing assets (T-bill interest) is redistributed to protocol participants through the USUAL governance token, rather than being captured entirely by the protocol operator (as with USDT/USDC). This addresses one of DeFi's loudest criticisms of centralized stablecoins: that issuers keep billions in yield while holders get nothing.
Smart Contracts
The smart contract system handles USD0 minting/redeeming, collateral management, and USUAL token distribution. The bond token USD0++ enables staking USD0 for yield. The contracts implement multiple safety mechanisms including collateral ratio monitoring and liquidation triggers. Audits have been completed by reputable firms. The contract architecture is well-designed but complex, with multiple interacting components.
Security
Security benefits from the conservative collateral choice (T-bills) which minimizes depeg risk from collateral volatility. The main security concerns are smart contract risk (complex multi-contract system), oracle risk for collateral valuation, and custodial risk for the underlying T-bill holdings. The protocol has implemented insurance-like mechanisms, but real-world collateral introduces off-chain custody risks that smart contracts cannot fully mitigate.
Yield Generation
Yield generation is straightforward and sustainable — it comes from actual T-bill interest (currently ~4-5% annualized) rather than token emissions or recursive leverage. This is a genuine yield source, not manufactured. Additional yield comes from DeFi composability (lending USD0, providing liquidity). The yield is real but not extraordinary — it's essentially passing T-bill rates to on-chain users.
Adoption
Adoption has been strong relative to the protocol's age. USD0 has achieved meaningful circulation, and the protocol attracted significant TVL during its growth phase. Binance Launchpool listing brought attention. Integration with major DeFi protocols (Curve, Morpho, Pendle) provides utility for USD0 holders. However, competition from Ethena, Maker, and other yield-bearing stablecoin alternatives is fierce.
Tokenomics
The USUAL token captures a share of protocol revenue (from T-bill yield), creating a direct link between collateral growth and token value. The distribution model rewards early adopters with higher USUAL emissions that decrease over time. This is a well-designed flywheel — more USD0 minted means more T-bill yield means more USUAL value. The risk is that USUAL emissions outpace actual revenue generation.
Risk Factors
- Regulatory risk — redistributing T-bill yield through a token may attract securities classification.
- Falling interest rates would directly reduce yield generation and USUAL token attractiveness.
- Complex multi-contract system increases smart contract vulnerability surface.
- Off-chain T-bill custody introduces risks that on-chain mechanisms cannot control.
- Competition from Ethena, Maker (DSR), and other yield-bearing stablecoins is intensifying.
Conclusion
Usual Money addresses a real problem — the inequitable distribution of stablecoin backing yield — with an elegant solution. The T-bill-backed model provides genuine, sustainable yield. The main risks are regulatory and competitive. If stablecoin regulation develops favorably, Usual Money could become a significant player. If regulators classify USUAL as a security, the model faces existential challenges.