USD0
Last updated: 2026-02-16
Executive Summary
USD0 is a USD-pegged stablecoin issued by Usual DAO and fully collateralized by short-duration U.S. Treasury Bills and equivalent sovereign instruments. It is a permissionless, composable ERC-20 that can be minted and redeemed 1:1 against eligible real-world asset (RWA) collateral at any time. USD0 operates on Ethereum (primary), Arbitrum, Base, and BNB Chain.
The collateral backing USD0 is held through multiple regulated tokenizers — primarily Hashnote (USYC), with additional diversification via M^0 ($M) and Spiko (USTBL) — each subject to independent custody, auditing, and regulatory oversight. The protocol enforces a zero-tolerance policy on credit and FX risk, a maximum portfolio-average duration of 0.33 years, and maintains a dedicated Insurance Fund sized between 0.33% and 5.33% of circulating USD0 supply.
Minting and redemption are managed through two on-chain pathways: direct (deposit/withdraw tokenized T-Bills) and indirect (deposit USDC, matched with a collateral provider). Peg stability is maintained through arbitrage incentives, a multi-collateral controller, and a Counter Bank Run (CBR) mechanism as a last-resort safeguard.
The protocol has undergone 20+ independent security audits since May 2024.
Key Facts
Token name
USD0
Token standard
ERC-20
Peg
1 USD0 = 1 USD
Decimals
18
Issuer
Usual DAO (governance-owned)
Collateral
100% short-duration U.S. Treasury Bills and equivalent sovereign instruments
Primary tokenizer
Hashnote (USYC) — CIMA licensed, CFTC registered
Additional tokenizers
M^0 ($M), Spiko (USTBL — AMF regulated, UCITS)
Custody (USYC)
The Bank of New York Mellon
Chains
Ethereum, Arbitrum, Base, BNB Chain
Minting
1:1 against eligible RWA collateral (direct) or USDC (indirect)
Redemption
1:1 at par, on-chain, any time
Min. primary order
100,000 USD0 (indirect path); no minimum (direct path)
Audits
20+ audits — Cantina, Sherlock, Spearbit, Halborn, Hexens, Paladin, OAK Security
Governance
100% DAO-owned (UIP-15, Dec 2025)
Collateral Framework
Eligible Collateral
USD0 collateral must satisfy four core criteria: (1) fully collateralized with no leverage, (2) low-risk sovereign instruments only, (3) transparent with on-chain verifiability and independent audits, and (4) liquid with a maximum redemption horizon of 5 business days.
USYC
Hashnote (Short Duration Yield Fund)
CIMA licensed, CFTC registered
BNY Mellon
T+0 to T+1
M
M^0 Protocol
Governed by Two-Token Governance (TTG)
SPV-held T-Bills, validated on-chain
On-chain
USTBL
Spiko (US T-Bills Money Market Fund)
AMF authorized (France), UCITS
CACEIS Bank
Same-day (J)
USDC
Circle
NY DFS regulated
Various (see Circle disclosures)
Indirect minting only
Risk Parameters
Max individual RWA duration
< 0.5 years
Max portfolio average duration
≤ 0.33 years (~4 months)
Passive deviation tolerance
0.25 years
FX risk
Zero tolerance — USD-only or 100% hedged
Credit risk
Zero tolerance — U.S. Treasuries, quasi-government, and cash only; no corporate debt
Max redemption horizon
5 business days
Tokenizer Due Diligence
Each collateral tokenizer is evaluated across five dimensions before governance approval:
Structuring & Regulation — Legal entity, jurisdiction, bankruptcy remoteness, compliance framework
Product Description — Subscription/redemption mechanics, fees, token specifications
Asset Management — AUM, custody arrangements, investment policy constraints
Risk Policy — Audits performed, counterparty exposure, recovery procedures
Operational Risk — Governance, compliance history, business continuity planning
Insurance Fund
The protocol maintains a dedicated Insurance Fund to absorb adverse collateral events:
Funding rate
~20% of protocol yield (DAO-configurable)
Minimum size
0.33% of USD0 supply
Maximum size
5.33% of USD0 supply
Replenishment time
~24 days (at 0.33-year average duration, 5% coupon rate)
Stress scenario
+100 bps interest rate shock in 1 month → ~0.33% loss (2022-calibrated)
Minting & Redemption
Primary Market — Direct Path
Institutional participants holding eligible tokenized collateral (USYC, $M, USTBL) may deposit RWA tokens directly into the protocol and receive USD0 at a 1:1 ratio. Redemption follows the reverse process: USD0 is surrendered and the holder receives the underlying RWA collateral at par.
Contract: DaoCollateral
Exchange rate: 1:1 at par (oracle-verified)
Minimum: None
Settlement: Immediate (on-chain)
Primary Market — Indirect Path
Users depositing USDC are matched with Collateral Providers who supply the RWA collateral on their behalf. Collateral Providers receive the USDC plus USUAL token incentives.
Contract: SwapperEngine
Exchange rate: 1USD0:1$ (depending of USDC price on secondary market)
Minimum order: 100,000 USD0 (orders below this threshold are routed to secondary markets)
Settlement: Dependent on collateral provider matching (typically same-day)
Secondary Market
USD0 is available on decentralized exchanges (Curve, Uniswap) and aggregators (Coswap, Velora) for immediate trading against USDC, USDT, and other assets. Arbitrage between primary and secondary markets naturally maintains peg stability.
Fees
Minting fee (direct)
RWA collateral → USD0
0 bps
Minting fee (indirect)
USDC → USD0
0 bps (protocol level)
Redemption fee (direct)
USD0 → RWA collateral
Governance-configurable (currently 0 bps)
Secondary market
DEX trading
Standard AMM fees (pool-dependent)
Note: Collateral Providers receive USUAL token incentives for facilitating indirect minting. Fee parameters are subject to change through DAO governance.
Peg Stability Mechanisms
1. Arbitrage
Full redeemability at par creates a natural arbitrage loop:
USD0 < $1: Buy discounted USD0 on secondary market → redeem at par against collateral → profit
USD0 > $1: Mint USD0 at par → sell at premium on secondary market → profit
2. Multi Collateral Controller (MCC)
The MCC optimizes collateral weights across tokenizers using a risk-adjusted scoring function that incorporates expected return, qualitative scoring, duration, and volatility. It operates on two layers:
Layer 1 — Continuous reward adjustment: USUAL incentive rates for collateral providers are dynamically adjusted; underrepresented collateral types receive higher rewards.
Layer 2 — Triggered rebalancing: When any collateral weight deviates beyond a governance-set threshold (ε), the system triggers active rebalancing.
3. Oracle Infrastructure
ClassicalOracle
0xb97e163cE6A8296F36112b042891CFe1E23C35BF
Primary collateral valuation
Chainlink USD0 Oracle
0x7e891DEbD8FA0A4Cf6BE58Ddff5a8ca174FebDCB
External USD0 price feed
4. Counter Bank Run (CBR) Mechanism
In extreme stress scenarios, the protocol can activate the CBR mechanism:
Burn Insurance Fund reserves to absorb losses
Pause minting engine to prevent dilution
Route all activity through secondary markets while the situation is resolved
5. Interest Rate Monitoring
The protocol monitors collateral yields via:
Daily weighted sum of collateral rates
180-day rolling average
Alert thresholds: ±5% deviation from prior day or ±20% deviation from SOFR
Revenue Model
USD0 collateral generates yield from short-duration U.S. Treasury instruments. This yield accrues to the protocol and is distributed as follows:
Locked USUALx holders
30%
Weekly USD0 distributions via Revenue Switch
DAO Treasury
70%
Funds protocol development, insurance, operations
Revenue Switch activated: January 13, 2025
Note: Simply staking USUAL → USUALx earns USUAL emissions but does not qualify for USD0 revenue distributions. A lock commitment (1, 3, 6, or 12 months) is required.
Security & Audits
The protocol has undergone 20+ independent security audits since May 2024, covering core protocol contracts, all token implementations, bridging infrastructure, investment vaults, staking modules, and economic model assessments.
Cantina
Core protocol, DaoCollateral, SwapperEngine, Distribution
May – Dec 2024
Sherlock
Multiple audit campaigns (8+) across all modules
Nov 2024 – Nov 2025
Spearbit
Core protocol, tokens, investment vaults
Jan – Jul 2025
Halborn
Core protocol, staking, EUR0/ETH0
Nov 2024 – Nov 2025
Hexens
Core protocol, economic model
May – Nov 2025
Paladin
L2 deployment, OFT adapters, cross-chain
Oct 2024
OAK Security
Economic assessment
Feb 2025
Blackthorne
Core protocol
Dec 2024
Security contact: [email protected]
Smart Contract Addresses
USD0 Token
Ethereum
0x73A15FeD60Bf67631dC6cd7Bc5B6e8da8190aCF5
Arbitrum
0x35f1C5cB7Fb977E669fD244C567Da99d8a3a6850
Base
0x758a3e0b1F842C9306B783f8A4078C6C8C03a270
BNB Chain
0x758a3e0b1f842c9306b783f8a4078c6c8c03a270
Core Protocol Contracts (Ethereum)
DaoCollateral
0xde6e1F680C4816446C8D515989E2358636A38b04
SwapperEngine
0xB969B0d14F7682bAF37ba7c364b351B830a812B2
TokenMapping
0x43882C864a406D55411b8C166bCA604709fDF624
RegistryAccess
0x0D374775E962c3608B8F0A4b8B10567DF739bb56
RegistryContract
0x0594cb5ca47eFE1Ff25C7B8B43E221683B4Db34c
Collateral Token Addresses (Ethereum)
USYC (Hashnote)
0x136471a34f6ef19fE571EFFC1CA711fdb8E49f2b
M (M^0)
0x866A2BF4E572CbcF37D5071A7a58503Bfb36be1b
UsualM (wrapped)
0x4Cbc25559DbBD1272EC5B64c7b5F48a2405e6470
USDC
0xA0b86991c6218b36c1d19D4a2e9Eb0cE3606eB48
UsualUSDC (wrapped)
0xb672B3976bAa3952bFb2eCE8eeFB784f8daB1424
Oracles (Ethereum)
ClassicalOracle
0xb97e163cE6A8296F36112b042891CFe1E23C35BF
Chainlink USD0 Oracle
0x7e891DEbD8FA0A4Cf6BE58Ddff5a8ca174FebDCB
Governance
USD0 is governed by Usual DAO, which holds 100% ownership of all protocol assets, intellectual property, and operational parameters (UIP-15, December 2025). Usual Labs operates as a service provider to the DAO under a defined mandate.
Key governance decisions affecting USD0:
Collateral onboarding/offboarding (e.g., UIP-14: USTBL approval; UIP-16: UZR approval)
Risk parameter calibration (duration limits, insurance fund sizing)
Fee structure modifications
Multi Collateral Controller weight adjustments
Emergency actions (CBR activation, minting pause)
Governance is exercised through the USUAL token via on-chain voting (UIPs — Usual Improvement Proposals).
Key Risks
Collateral risk
Adverse event at a tokenizer or custodian could impair underlying collateral value
Diversified tokenizer base; Insurance Fund; CBR mechanism; zero credit/FX tolerance
Interest rate risk
Rising rates reduce mark-to-market value of T-Bill holdings
Max portfolio duration ≤ 0.33 years; stress-tested for +100 bps shock
Counterparty risk
Failure of tokenizer, fund manager, custodian, or banking partner
Multi-provider diversification; regulated entities (BNY Mellon, CACEIS); due diligence framework
Smart contract risk
Vulnerability in protocol code
20+ audits; upgradeable proxy architecture; [email protected] bug reporting
Liquidity risk
Temporary inability to redeem at par during extreme market stress
5-day max redemption horizon; Insurance Fund; CBR mechanism; secondary market liquidity
Oracle risk
Incorrect price feed could affect minting/redemption pricing
Dual oracle system (ClassicalOracle + Chainlink); monitoring alerts
Governance risk
DAO decisions that adversely affect USD0 parameters
On-chain voting via UIPs; transparent proposal process; multi-signature execution
Regulatory risk
Evolving regulatory landscape for stablecoins and tokenized securities
Multi-jurisdictional tokenizer diversification (CIMA, AMF, CFTC); no leverage; full backing
Concentration risk
Over-reliance on a single collateral provider
Multi Collateral Controller enforces diversification; active expansion of tokenizer base
Quick Links
Usual Protocol — Documentation: https://docs.usual.money/
USD0 — Product Overview: https://docs.usual.money/usual-products/usd0-stablecoin/usd0
Collateral & Backing: https://docs.usual.money/usual-products/usd0-stablecoin/usd0/rwa-collateral
Minting & Redeeming: https://docs.usual.money/usual-products/usd0-stablecoin/usd0/flow-and-architecture
Security & Audits: https://tech.usual.money/security-and-audits/audits
Governance (UIPs): https://docs.usual.money/usual-products/usual-governance-token/usual-governance
Etherscan — USD0 Token: https://etherscan.io/token/0x73A15FeD60Bf67631dC6cd7Bc5B6e8da8190aCF5
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. USD0 is a decentralized protocol token governed by Usual DAO; participation involves risks including but not limited to smart contract risk, collateral risk, regulatory risk, and market risk. 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 USD0. 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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