USD0++ Alpha Yield

USD0++ and Yield mechanism

Users who wish to gain exposure to Alpha Yield in the form of $USUAL tokens must lock their USD0 as USD0++. In return, they have several options available to them.

Claiming Yield: The holder of USD0++ can claim their yield daily in the form of USUAL tokens.

Return of Principal: At the end of the bond's maturity period, the holder receives their principal in the form of the initially locked USD0.

Yield Distribution and Governance

The yield from USD0++ is distributed natively in the form of USUAL tokens, the governance token of the Usual protocol. This yield is speculative due to the nature of the USUAL token, referred to as Alpha Yield.

Superior Yield Model

Usual’s model is designed to outperform the native risk-free yield of the underlying asset with the $USUAL token. It incentivizes early entrants and ensures a sustainable flywheel effect.

Alpha Yield

The yield from USD0++ is called Alpha Yield (α-yield) because it includes an additional token with its own volatility and pricing. This provides exposure to the issuer’s success, not just the underlying yield. This financial engineering ensures that USUAL offers significantly better rates than the asset’s yield alone.

Advantages of USUAL

The USUAL token's value increases with the Total Value Locked (TVL). Early participation is theoretically highly beneficial, as the rewards are greater for those who join sooner.