ETH0
Type: Factsheet | Squad: Usual | Status: Draft | Stream: BD Last updated: 2026-02-16
Executive Summary
ETH0 is an Ethereum-pegged synthetic asset issued by Usual DAO, fully collateralized 1:1 by Lido's wrapped staked ETH (wstETH). Each ETH0 in circulation is backed by at least 1 ETH worth of wstETH held in the protocol's on-chain Collateral Treasury. ETH0 is designed to track the value of ETH while providing holders with access to USUAL token emissions on top of the native ETH staking yield embedded in wstETH.
Unlike USD0 and EUR0, which are fiat-pegged stablecoins backed by Treasury Bills, ETH0 is an ETH-denominated synthetic with full crypto-market exposure. Holding ETH0 is economically equivalent to holding ETH: the token appreciates and depreciates in USD terms with the ETH price. The staking rewards generated by the underlying wstETH collateral (approximately 3.0--3.5% APR) are captured by the protocol and redistributed as USUAL governance tokens, providing an additional yield layer.
ETH0 uses the same on-chain collateral infrastructure established for USD0, including permissionless minting/redemption, oracle-based circuit breakers, and DAO governance over collateral parameters. ETH0 was approved via UIP-8 (June 9, 2025; 94.7% For) and launched in June 2025. It has been audited by Hexens and Spearbit, with additional coverage across the broader Usual audit program (20+ audits since May 2024).
Key Facts
Token name
ETH0
Token standard
ERC-20
Peg
1 ETH0 = 1 ETH (in ETH terms)
Asset type
ETH-denominated synthetic
Decimals
18
Issuer
Usual DAO (governance-owned)
Collateral
100% Lido wstETH (wrapped staked Ether)
Native staking yield
~3.0--3.5% APR (ETH consensus-layer rewards, accrued in wstETH)
Additional yield
USUAL token emissions to ETH0 holders
Chain
Ethereum
Minting
Permissionless; 1:1 deposit of wstETH
Redemption
1:1 withdrawal of wstETH, on-chain, at any time
Redemption fee
5 bps (governance-configurable)
Launch date
May 2025
Governance approval
UIP-8 (June 9, 2025; 94.7% For)
Governance
100% DAO-owned (UIP-15, Dec 2025)
Collateral Framework
Collateral Asset: wstETH (Lido)
Asset
wstETH (wrapped staked Ether)
Provider
Lido Finance
Underlying
ETH staked on Ethereum's Beacon Chain via Lido
Token type
Non-rebasing; value appreciates as staking rewards accrue (wstETH/ETH exchange rate increases)
TVL (Lido)
>$22 billion (at time of UIP-8 approval)
Liquidity
Among the most liquid staking derivatives; redeemable for ETH via Lido withdrawals
Collateral Properties
Fully collateralized (1:1): No leverage, no fractional reserves. Every ETH0 is backed by at least 1 ETH worth of wstETH.
Transparent: Anyone can verify the wstETH balance held by ETH0-related contracts on-chain at any time.
Ethereum-native: Collateral resides entirely on Ethereum's Beacon Chain (via Lido). No traditional finance counterparty, no bank custody, no fund administrator, no tokenizer bankruptcy risk.
Liquid: wstETH is deeply liquid on major DEXs and redeemable for ETH via Lido withdrawals.
Collateral Eligibility within the Usual Framework
While USD0 and EUR0 collateral is constrained by portfolio duration, FX risk, and credit risk parameters suited to fiat-backed designs, ETH0 follows a crypto-native framework adapted for ETH-denominated collateral while maintaining the same overarching principles of full collateralization, low risk, transparency, and liquidity.
Minting & Redemption
Primary Market
Mint
Deposit wstETH to the DaoCollateral contract. For each 1 ETH worth of wstETH deposited, 1 ETH0 is minted.
Redeem
Return ETH0 to the protocol. ETH0 is burned, and the equivalent wstETH is released.
Mint fee
0 bps (no fee)
Redemption fee
5 bps (protects treasury from oracle update exploits)
Access
Permissionless (no KYC/KYB required)
Settlement
Immediate (on-chain)
Secondary Market
ETH0 is tradable on decentralized exchanges. Target liquidity pools include ETH0/wstETH and ETH0/ETH. Even if secondary market liquidity is limited, holders can always redeem ETH0 on-chain for the underlying wstETH at 1:1 (less redemption fee).
Yield Structure
ETH0 provides two sources of value to holders:
1. Native Staking Yield (wstETH)
The wstETH collateral continuously accrues Ethereum consensus-layer rewards at approximately 3.0--3.5% APR. This yield is captured by the protocol as wstETH appreciates in ETH terms.
2. USUAL Token Emissions
ETH0 holders receive USUAL governance token distributions. The daily USUAL emission for locked assets is split proportionally between bUSD0 and ETH0 based on the dollar value of each asset. This provides an additional yield layer on top of the native staking return.
Revenue from wstETH staking yield is distributed to USUALx holders through the protocol's existing revenue-sharing model, alongside revenue from USD0's T-Bill interest.
Fees
Minting
0 bps
No protocol fee
Redemption
5 bps
Governance-configurable; protects against oracle update exploits
Secondary markets
Per venue
Trading fees per exchange
Smart Contract Addresses
ETH0 Token
Ethereum
0x734eec7930bc84ec5732022b9eb949a81fb89abe
Related Contracts (Ethereum)
ETH0 ClassicalOracle
0x8a03c57069A25C7E6e62e9C0d03a2CC10A74b1a7
Lido wstETH Oracle
0xEB9B65345B1eeD32153Ef85D97874c1aD98e5DC4
DaoCollateral
0xde6e1F680C4816446C8D515989E2358636A38b04
Distribution
0x75cC0C0DDD2Ccafe6EC415bE686267588011E36A
Collateral Treasury
0xdd82875f0840AAD58a455A70B88eEd9F59ceC7c7
Security & Audits
ETH0 benefits from the broader Usual Protocol security program (20+ audits since May 2024), with the following ETH0-specific coverage:
Hexens
ETH0 audit
May 2025
Spearbit
ETH0 and Zapper audit
May 2025
ETH0 reuses audited infrastructure from the USD0 protocol, which has undergone extensive review by Cantina, Sherlock, Halborn, and others.
Security contact: [email protected]
Key Risks
ETH market price
ETH0 tracks ETH; holding ETH0 exposes holders to full ETH price volatility in fiat terms. A 20% ETH decline results in a ~20% decline in ETH0 USD value.
By design. ETH0 is not a fiat stablecoin. Users seeking to minimize ETH price volatility should consider USD0 or EUR0.
Lido / slashing risk
A major slashing event, validator performance issues, or smart contract vulnerability in Lido could impair wstETH and therefore ETH0 collateral.
Chainlink oracle-based circuit breaker can automatically pause minting/redemption on anomaly detection. Full 1:1 collateralization. Insurance fund (DAO-configurable). Counter Bank Run (CBR) mechanism.
Smart contract risk
Vulnerability in ETH0, DaoCollateral, or Lido contracts.
Hexens and Spearbit ETH0-specific audits. 20+ protocol-wide audits. Emergency pause/unpause mechanisms. Single-collateral design reduces attack surface.
Liquidity risk
As a newer asset, ETH0 may have limited secondary market liquidity.
Direct on-chain redemption for wstETH at 1:1 (less fee) provides a liquidity backstop independent of secondary markets. USUAL-incentivized liquidity pools.
Oracle risk
Incorrect wstETH price feed could affect minting/redemption pricing.
Dual oracle system (ETH0 ClassicalOracle + Lido wstETH Oracle). Circuit breaker on anomalous readings.
Counterparty risk
Dependency on Lido for staking operations.
No traditional finance counterparty exposure (no bank, custodian, or tokenizer risk). Lido is the largest liquid staking protocol on Ethereum with extensive audit coverage and long operating track record.
Governance risk
DAO decisions that adversely affect ETH0 parameters.
On-chain voting via UIPs; transparent proposal process; multi-signature execution.
Quick Links
ETH0 Product Documentation: https://docs.usual.money/usual-products/synthetic/eth0-synthetic
ETH0 Collateral and Risk: https://docs.usual.money/usual-products/synthetic/eth0-synthetic/collateral-and-risk
UIP-8 (wstETH Onboarding): https://snapshot.box/#/s:usualmoney.eth/proposal/0xa41a0e8c0def902ee6d4835399decb5b5b1fa15b5c1b527b096352431665a94f
Usual Protocol Documentation: https://docs.usual.money/
Security & Audits: https://tech.usual.money/security-and-audits/audits
Etherscan (ETH0): https://etherscan.io/token/0x734eec7930bc84ec5732022b9eb949a81fb89abe
Lido Finance: https://lido.fi/
Disclaimer
This factsheet is provided for informational purposes only and does not constitute investment advice, an offer to sell, or a solicitation of an offer to buy any security or financial instrument. ETH0 is a decentralized protocol token governed by Usual DAO; participation involves risks including but not limited to smart contract risk, collateral risk, market risk (full ETH price exposure), and Lido staking risk. ETH0 is not a stablecoin and will fluctuate in fiat-denominated value. Past performance and historical data are not indicative of future results. Investors should conduct their own due diligence and consult professional advisors before acquiring or interacting with ETH0. All smart contract addresses should be independently verified on the respective block explorers. Protocol parameters are subject to change through DAO governance.
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