# EUR0

**EUR0** is the euro-denominated stablecoin of the Usual ecosystem. It is collateralized by **high-quality European sovereign bonds** via **euTBL** (Spiko EU T‑Bills Money Market Fund). EUR0 is designed as the euro counterpart to **USD0**: a settlement asset in **EUR (€)** that is composable in DeFi and built on stable underlying assets to maximize security.

EUR0 uses the **same stablecoin architecture as USD0,** bridging **permissioned** and **permissionless** access to tokenized real-world assets (RWAs). While USD0 is backed by US Treasury Bills, EUR0 is backed by **Eurozone T‑Bills** (France, Germany, and other Eurozone sovereign issuers), supporting Usual’s multi-currency vision.

***

## Mint & Redeem

EUR0 supports two minting/redemption routes:

* **Permissionless (via EURC)**: Mint/redeem at **1 EUR0 = €1 EURC**, instantly **within available euTBL/EURC liquidity**, via the **Swapper Engine**.
* **Permissioned (via euTBL)**: Mint/redeem at **1 EUR0 = €1 euTBL**, with **unlimited** capacity for eligible (allowlisted) addresses.

### Direct path (permissioned): `euTBL → EUR0`

Use this path if you are eligible to interact with Spiko’s permissioned contracts.

* **Mint**: Deposit **euTBL** to mint **EUR0 at par**\
  \&#xNAN;*(€1 euTBL = 1 EUR0)*.
* **Redeem**: Burn **EUR0** to receive **euTBL at par**, minus a **3 bps** redemption fee\
  \&#xNAN;*(1 EUR0 = €1 euTBL − 3 bps)*.
* **KYC/KYB**: Access to Spiko’s **Teller/Permission Manager** contracts is restricted to **allowlisted** addresses. Institutional use requires **KYC/KYB**.

This mirrors the USD0 architecture: permissioned participants (e.g., institutional users, accredited investors) can mint/redeem directly against the underlying collateral through the protocol’s `DaoCollateral`-equivalent contract.

### Indirect path (permissionless): `EURC → EUR0` via the Swapper Engine

This path enables retail and DeFi-native users to access EUR0 without holding euTBL directly.

* **Mechanism**: The Swapper Engine orchestrates the conversion:\
  **EURC → euTBL → EUR0** (on-chain order mechanism, similar to the USD0 ↔ USDC implementation).
* **Execution model**: **Non-atomic** (may not settle in the same transaction):
  * **T0**: Instant processing within the limits of available **EURC** and **euTBL** liquidity.
  * **T+1 to T+5**: Possible if buffers/loopers are empty. The dApp shows **pending order**, **queue position**, and **Looper liquidity**. **Secondary markets** (Spiko ATM v2, DEX pools) can be used as alternatives.
* **Cancellation & availability**:
  * **Cancelability**: Orders can be **cancelled** as long as they are not executed.
  * **UI states**: **Pause**, **cap reached**, or **insufficient collateral** are clearly indicated.
  * **Notification**: Users are notified upon execution.

In this flow, a **Collateral Provider (CP)** supplies the underlying RWA collateral on the user’s behalf, as in the USD0/USDC path.

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## Secondary Liquidity

EUR0 is also tradable on secondary markets. As deployment expands, liquidity will be incentivized against other assets in the Usual ecosystem, especially **USD0,** to support an on-chain FX market.

* **Target pools**: **EUR0/EURe**, **EUR0/USD0**

The **EUR0/USD0** pool is central to Usual’s long-term plan to build **clearFX** (described in the V2 roadmap): an on-chain currency conversion layer enabling euro-to-dollar swaps within the ecosystem. This supports the protocol’s broader ambition to become a **DeFi Fintech** offering multi-currency accounts and payment infrastructure.

> **Important**: Usual Protocol does not guarantee secondary market liquidity or the EUR0 peg on secondary venues. Peg stability relies on arbitrage between primary market mint/redemption (at par) and secondary market pricing, consistent with the USD0 stability model.

***

## Collateral & Reserves

### Reserve asset: euTBL (Spiko)

| Property                 | Detail                                                    |
| ------------------------ | --------------------------------------------------------- |
| **Asset**                | euTBL (Spiko EU T-Bills Money Market Fund)                |
| **Type**                 | Short-term EUR money market fund (VNAV)                   |
| **Underlying**           | Euro area T-Bills (France, Germany, etc.)                 |
| **Maximum maturity**     | < 6 months                                                |
| **Average duration**     | < 60 days                                                 |
| **NAV publication**      | Daily, on-chain (Chainlink oracle) and at official venues |
| **Auditor**              | PwC                                                       |
| **Smart contract audit** | Trail of Bits                                             |
| **Regulatory status**    | Spiko is approved and supervised                          |
| **Access control**       | ERC-20 with allowlist/KYC management (Permission Manager) |

**Implication for EUR0**: Each EUR0 in circulation corresponds to **€1 of euTBL value**, measured at NAV and managed through the mint/redeem flows described above.

### Collateral eligibility

EUR0 follows the same due diligence framework as USD0, adapted to Eurozone assets:

* **Fully collateralized (1:1)**: No leverage and no fractional reserves. Every EUR0 is backed by euTBL at par value.
* **Low risk**: Exposure is limited to sovereign bonds from high-quality Eurozone issuers.
* **Transparent**: Collateral is verifiable:
  * **On-chain** via Chainlink price feeds
  * **Off-chain** via PwC audits and daily NAV publication
* **Liquid**: Short maturity profile (**< 6 months**, average duration **< 60 days**) aligns with Usual’s portfolio duration threshold for LDTs.
* **Zero FX risk**: Collateral is entirely **EUR-denominated**, consistent with Usual’s zero-tolerance FX risk policy.
* **Zero credit risk (policy)**: Holdings are restricted to **Eurozone sovereign debt**; **corporate debt is prohibited**.

### Spiko as collateral provider

Spiko is the tokenizer for EUR0’s collateral, analogous to Hashnote’s role for USD0. Usual’s tokenizer evaluation process covers:

* **Structuring & regulation**: Spiko operates under regulatory supervision with a clear legal framework for tokenized securities.
* **Asset protection**: Assets are ring-fenced in the event of Spiko bankruptcy.
* **Fee structure**: Fees are designed to remain reasonable and not materially erode returns.
* **Redemption process**: Prompt and straightforward; the **3 bps** redemption fee is the only cost on the direct path.
* **Security**: Contracts audited by **Trail of Bits**, with ERC-20 allowlist/KYC management via a Permission Manager.

***

### V2 vision: multi-currency accounts

EUR0 is a core component of the V2 roadmap, which envisions a **USUAL Mobile App** as a single interface for:

* **Multi-currency accounts** (USD0 & EUR0)
* **USUAL IBAN** for traditional banking integration
* **clearFX** for on-chain EUR ↔ USD conversion via EUR0/USD0 pools
* **USUAL Credit Card** supporting both euro and dollar denominations

***

## EUR0 vs. USD0: Key Differences

| Feature                  | EUR0                               | USD0                               |
| ------------------------ | ---------------------------------- | ---------------------------------- |
| **Currency peg**         | €1.00 (Euro)                       | $1.00 (US Dollar)                  |
| **Collateral**           | Eurozone sovereign T-Bills (euTBL) | US Treasury Bills (USYC, M, USTBL) |
| **Primary tokenizer**    | Spiko                              | Hashnote                           |
| **Indirect mint asset**  | EURC                               | USDC                               |
| **Redemption fee**       | 3 bps                              | Varies by governance               |
| **Regulatory framework** | EU-supervised (Spiko)              | CIMA/CFTC (Hashnote)               |
| **NAV oracle**           | Chainlink (daily)                  | On-chain real-time                 |
| **Average duration**     | < 60 days                          | < 0.33 years (\~120 days)          |

***

## Risk Considerations

EUR0 inherits Usual’s risk framework, with Eurozone-specific considerations:

* **Interest rate risk**: Mitigated by short average duration (**< 60 days**), well within Usual’s **0.33-year** portfolio duration threshold.
* **Sovereign credit risk**: Diversified across multiple Eurozone issuers (France, Germany, etc.), all with high credit ratings.
* **Counterparty risk**: Spiko is regulated, audited by **PwC**, and its smart contracts are audited by **Trail of Bits**. Assets are ring-fenced against Spiko bankruptcy.
* **Liquidity risk**: The short-term VNAV structure and Spiko’s redemption infrastructure support timely exits.
* **Secondary market risk**: The secondary-market peg is not guaranteed; stability depends on arbitrage between primary and secondary markets (as with USD0).


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