Usual Protocol issues USD0 — a stablecoin backed 1:1 by tokenized US Treasury bills (not bank deposits) — and USUAL, a governance token that entitles holders to a share of the protocol’s T-bill yield. The core thesis: Tether (USDT) and Circle (USDC) collect billions in T-bill interest on user deposits but share nothing with users. Usual Protocol disagrees: by building USD0 on chain and backing it with publicly auditable tokenized RWA (BlackRock BUIDL, Hashnote USYC, etc.), and by distributing a portion of the T-bill interest to USUAL token stakers, Usual creates a stablecoin that is simultaneously a savings instrument paying its users the risk-free rate. When USUAL is staked, holders receive USD0++ — a locked version of USD0 that accrues all protocol yield, functioning similarly to a bond. The protocol was co-founded by Pierre Person (former French National Assembly member) and other French entrepreneurs, and has attracted significant institutional attention as a model for democratizing the economics of stablecoin issuance.
How It Works
| Component | Role |
|---|---|
| USD0 | 1:1 USD-pegged stablecoin; backed by tokenized T-bill RWA products |
| RWA collateral | BlackRock BUIDL, Hashnote USYC, and other tokenized US Treasury products |
| USUAL token | Governance token; distributed to protocol participants; holders share yield |
| USD0++ | Staked USD0 locked for 4 years; accrues T-bill yield distributed as USUAL tokens |
| USUALx | Staked USUAL token; receives protocol fee share |
| DAO | USUAL holders govern protocol parameters, collateral types, yield distribution |
Revenue model:
- Protocol holds T-bill-backed RWA collateral earning risk-free rate (~5% at current rates)
- Portion of that interest mints new USUAL tokens and distributes to USD0++ holders
- USD0++ represents: $1 of USD0 backed by T-bills + yield distributed in USUAL tokens
- USUAL tokens derive value from the present value of future yield distributions
Key Features
| Feature | Details |
|---|---|
| T-bill backed | USD0 backed by tokenized short-term US Treasuries — no bank deposit risk |
| Yield sharing | Protocol distributes T-bill yield to USUAL/USD0++ holders — no private extraction |
| Fully transparent | Collateral backed by publicly auditable on-chain RWA positions |
| Decentralized governance | USUAL DAO controls protocol parameters |
| USD0++ savings | Locking USD0 earns yield — alternative to savings account |
History
- 2023: Usual Protocol founded in France; Pierre Person and team begin development
- 2024 (Q1): USD0 launches on Ethereum mainnet; initial BUIDL collateral integration
- 2024 (Q2): Protocol grows rapidly — USD0 supply reaches hundreds of millions
- 2024 (Q3-Q4): USUAL token TGE; USD0++ mechanism launched; rapid TVL growth
- 2024: Protocol ranked among top DeFi protocols by growth rate; integrations with major DeFi venues
- 2024: USD0 supply reaches $1B+; Hashnote, Ondo integration as collateral options
Common Misconceptions
“USD0 is like an algorithmic stablecoin because it has a governance token.”
Having a governance token (USUAL) does not make USD0 algorithmic. USD0 is backed 1:1 by real government securities (T-bills) in tokenized form. The USUAL token represents a claim on future yield, not a mechanism for maintaining the USD0 peg. USD0 would retain its peg even if USUAL went to zero (the T-bill collateral still backs each dollar).
“USD0++ is USD0 at $1.”
USD0++ is USD0 that has been staked and locked in the DAO for yield accrual. During the lock-up period, USD0++ trades at a slight discount to USD0 on secondary markets due to illiquidity. USD0++ holders receive T-bill yield in USUAL tokens — the USD0 itself is always redeemable at maturity.
Criticisms
- Lock-up risk: USD0++ requires a 4-year lock commitment — significant illiquidity for users seeking yield; secondary market discount may emerge, especially in bear markets
- USUAL token circularity: The protocol distributes yield in USUAL tokens (not T-bill interest directly) — if USUAL loses value, the “yield” distributed to USD0++ holders is worth less, creating a feedback loop between USUAL price and USD0++ attractiveness
- RWA custody concentration: T-bill collateral relies on third-party tokenized RWA providers (BUIDL, USYC) — any issue with those products (redemption freeze, regulatory action) could impair USD0 collateral
- Regulatory risk: French founders; EU MiCA regulations create specific requirements for euro/dollar stablecoin issuers; USUAL’s compliance status under evolving regulations is uncertain
Social Media Sentiment
Usual Protocol received strong positive attention as a “Tether/Circle killer” narrative resonated widely — users fundamentally agree that stablecoin issuers should share yield with users rather than keeping it. The French-political co-founder added a unique credibility angle. USUAL’s TGE generated significant DeFi excitement. Overall highly positive community; yield-sharing narrative is compelling and defensible.
Last updated: 2026-04
Related Terms
Sources
- Usual Protocol Documentation — docs.usual.money (2024). Official documentation — USD0 minting and redemption mechanics, RWA collateral accepted, USUAL tokenomics, USD0++ lock mechanics, and yield distribution formula.
- “Democratizing Stablecoin Yield: The Case Against Tether’s Revenue Extraction” — Usual Protocol / Pierre Person (2024). Founder’s thesis explaining why Usual was built — the observation that Tether earned $6.2B profit in 2023 by collecting T-bill interest on USDT holders’ dollars while users received nothing.
- “RWA Stablecoin Design: Comparing Usual, Ondo, Mountain Protocol” — Messari Research (2024). Comparative analysis of T-bill-backed stablecoin designs — examining different approaches to tokenized treasury stablecoins including Usual’s USUAL yield distribution vs. Ondo’s USDY accrual model vs. Mountain Protocol’s USDM rebase model.
- “USD0 Collateral Risk Assessment: Tokenized Treasury Products” — Chaos Labs / Usual Protocol (2024). Risk analysis of USD0’s collateral base — evaluating BUIDL, USYC, and other tokenized treasury products used as backing, including liquidity, redemption, and counterparty risks.
- “France’s DeFi Bet: Usual Protocol and the Political Economy of Stablecoins” — The Block / Unchained (2024). Profile of Usual Protocol co-founder Pierre Person (former French parliament member turned DeFi founder) and the political context for Europe’s stablecoin regulation and Usual’s compliance strategy.